Manufacture by fabrication requires a new commercially identifiable article; excisability was sustained on the stated facts.

Fabrication of MS rods, MS angles and MS flats by cutting, punching, bending and welding amounts to manufacture only where it results in a new and commercially identifiable article with a separate market identity. Applying that test, CESTAT Hyderabad found that the revenue had established excisability on the facts presented, and sustained the duty demand in favour of Revenue.

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Issues: Whether the goods fabricated by cutting, punching, bending and welding of MS rods, MS angles and MS flats amounted to manufacture and were therefore excisable.

Analysis: The dispute turned on whether the fabrication process brought into existence a new and distinct commercially known article. The goods were produced by operations such as cutting, punching, bending and welding of steel inputs. The applicable approach required examination of whether such activities resulted in emergence of a new product with a separate identity in the market. The Tribunal relied on the principle that mere processing of raw material does not amount to manufacture unless a new article emerges. Considering the legal position reflected in the cited higher court authorities, the Tribunal held that the revenue had established excisability.

Conclusion: The goods were held to be excisable and the demand was sustained, in favour of Revenue.

Ratio Decidendi: Fabrication by cutting, punching, bending and welding amounts to manufacture only if it results in the emergence of a new commercially identifiable article.

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