Relabelling and repacking of imported goods can amount to manufacture, sustaining confiscation-related redemption fine.

Relabelling, repacking and upward revision of MRP on imported goods were treated as manufacture under Section 2(f) of the Central Excise Act, 1944 and Chapter 33 Note 5 of the Central Excise Tariff Act, 1985. The appellant's admission, supported by unrebutted warehouse statements, was sufficient to show that the goods had lost their original imported character. Absence of central excise registration and failure to produce reliable proof linking CVD payment to the seized goods further weakened the challenge. The redemption fine imposed in lieu of confiscation was therefore upheld, and the appeal failed.

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Issues: Whether the redemption fine imposed in lieu of confiscation of seized goods was sustainable where the appellant had undertaken relabelling, repacking and upward revision of MRP on imported goods without central excise registration.

Analysis: The appellant's own admission, coupled with un-rebutted statements of warehouse personnel, showed that the goods had undergone relabelling and repacking activity amounting to manufacture under Section 2(f) of the Central Excise Act, 1944 and Chapter 33 Note 5 of the Central Excise Tariff Act, 1985. The fact that CVD was payable to offset the excise component did not negate the manufacturing character of the activity. The record also showed that the appellant was unregistered and had not produced reliable proof correlating CVD payment to the seized goods. The admission regarding upward revision of MRP was sufficient evidence of the activity, and the seized goods could not be treated as merely imported goods in their original form.

Conclusion: The redemption fine imposed in lieu of confiscation was upheld and the challenge failed.

Final Conclusion: The appeal was dismissed and the adjudication order confirming confiscation-related penalty was maintained.

Ratio Decidendi: Where imported goods are subjected to relabelling, repacking and MRP alteration without registration, such activity constitutes manufacture and can sustain confiscation-related consequences despite the appellant's plea of revenue neutrality or absence of duty demand on cleared goods.

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