Aluminum can assembly not manufacturing for excise duty. Contractor liable, not appellant. Appeal allowed.

The Tribunal held that the assembly of aluminum card cans from parts did not amount to manufacturing for excise duty purposes as it did not result in a new product with a different character or use. Since the appellant did not conduct the assembly work themselves and ordered complete card cans from a supplier, any duty payable should be demanded from the contractor who assembled the goods, not the appellant. Consequently, the appeal was allowed in favor of the appellant.

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Issues:
1. Whether the activity of forming the aluminum card cans from the parts amounts to manufacture.

Analysis:
The appeal involved the question of whether the assembly of aluminum card cans from parts constitutes manufacturing, leading to the imposition of excise duty. The appellant argued that assembling card cans received in a completely knocked-down (CKD) condition does not amount to manufacture, citing precedents where mere assembly of parts did not qualify as manufacturing. The appellant further contended that the assembly work was carried out by the supplier, not by them, and any duty should be demanded from the supplier. On the other hand, the Departmental Representative argued that as the card cans were assembled for the first time in the appellant's premises, creating a new commodity, excise duty was payable by the appellant as the manufacturer. The representative relied on a judgment stating that constructing a manufacturing unit from duty-paid parts amounts to manufacturing.

The Tribunal considered the submissions from both sides and analyzed the situation. It was noted that the card cans were received in unassembled condition at the appellant's factory, a common practice for ease of transport. Referring to previous decisions, the Tribunal held that the assembly of parts did not result in a new product with a different character or use, thus not constituting manufacturing for excise duty purposes. The Tribunal also highlighted that the appellant had ordered complete card cans with accessories from a supplier, and there was no evidence that the assembly work was done by the appellant themselves. The Tribunal concluded that if any duty was payable, it should be demanded from the contractor who assembled the goods, not from the appellant. Therefore, the appeal was allowed in favor of the appellant.

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