Carbon dioxide cylinder filling was not manufacture, and a final prior order barred the Department from taking a contrary stand.

Compression of carbon dioxide received through pipelines and filling it into cylinders was held not to amount to manufacture under Chapter Note 9 of Chapter 28, because the process was treated as mere packing and did not satisfy the statutory limbs for labeling, repacking, or rendering goods marketable. The demand also failed because a later order on the same facts had already concluded that the activity was not manufacture and that order had attained finality; the Department could not take a contrary stand for earlier periods on identical facts. The duty, interest, and penalties were therefore set aside.

---

---

Issues: (i) Whether compression of carbon dioxide received through pipelines and filling it into cylinders amounted to manufacture under Chapter Note 9 of Chapter 28 of the Central Excise Tariff Act, 1985. (ii) Whether the Department could sustain the demand for the disputed periods when, for a subsequent period on the same facts, the competent authority had held that the activity did not amount to manufacture and that order had attained finality.

Issue (i): Whether compression of carbon dioxide received through pipelines and filling it into cylinders amounted to manufacture under Chapter Note 9 of Chapter 28 of the Central Excise Tariff Act, 1985.

Analysis: Chapter Note 9 treats labeling or relabeling of containers, repacking from bulk packs to retail packs, or adoption of any other treatment to render the product marketable to the consumer as manufacture. The earlier decision in the appellant's own case had held that the activity was only packing and not manufacture, and that view had been affirmed by the Supreme Court. The later order under the same statutory framework found that the process remained unchanged and did not fall within the first two limbs of the Note or the residual limb relating to rendering the product marketable. The later view that the amendment substituting "and" with "or" made no material difference was accepted.

Conclusion: The activity did not amount to manufacture; the demand could not be sustained on this ground.

Issue (ii): Whether the Department could sustain the demand for the disputed periods when, for a subsequent period on the same facts, the competent authority had held that the activity did not amount to manufacture and that order had attained finality.

Analysis: The order for the subsequent period squarely considered the same controversy and concluded that the activity was not manufacture. That order was not appealed against and therefore attained finality. In such circumstances, the Department could not be permitted to take a contrary stand for the earlier disputed periods on the very same issue and facts. The later final order was treated as binding for departmental consistency in the appellant's own case.

Conclusion: The Department was precluded from adopting a contrary stand; the impugned confirmations could not be sustained.

Final Conclusion: The appeals succeeded and the impugned orders confirming duty, interest and penalties were set aside, leaving no surviving demand against the appellant for the periods in dispute.

Ratio Decidendi: Where the same process in the assessee's own case has already been finally held not to amount to manufacture on identical facts and unchanged law, the Department cannot, for another period, contend to the contrary or invoke deemed manufacture beyond the scope of the relevant chapter note.

---