Repacking duty-paid retail goods without value addition or altered declarations does not amount to manufacture for excise purposes.

Affixing a hologram and bar code, then repacking pre-packed duty-paid medicines into an outer cover box for safe delivery, did not amount to manufacture because the goods remained pre-packed, bore the required declarations including MRP, had already suffered duty under Section 4A, and were not relabelled or materially altered. As the process involved no value addition and no change to the retail pack or statutory declarations, central excise duty was not attracted.

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Issues: Whether the activity of affixing hologram and bar code, repacking pre-packed duty-paid medicines into an outer cover box, and related handling amounted to manufacture so as to attract central excise duty.

Analysis: The activity in question was examined in light of the Board's clarification on marketing and repacking of pre-packed duty-paid retail goods. The determining consideration was whether the process resulted in any value addition or altered the retail pack or declarations already affixed on the goods. The goods were received in pre-packed form, bore the necessary declarations including MRP, had already suffered duty on the basis of retail sale price under Section 4A, and were not relabelled or materially altered. The process was only a transfer of such goods into another packing for safe delivery, which did not satisfy the basis for treating packing or repacking as manufacture.

Conclusion: The activity did not amount to manufacture and central excise duty was not attracted; the impugned order was set aside and the appeals were allowed.

Final Conclusion: Repacking of pre-packed duty-paid retail goods without value addition or alteration of the retail declarations is not exigible to excise duty.

Ratio Decidendi: Where packing or repacking of duty-paid pre-packed goods does not involve value addition or alteration of the retail pack or statutory declarations, the process does not amount to manufacture for excise purposes.

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