Manufacture test for repacking: adding propellant and smaller packaging did not create a new product, so no manufacture was found.

Repacking mould release preparation from bulk into small aerosol cans with added propellant gas did not amount to manufacture because the process only changed the mode of application and use. Mere value addition or packing into consumer-sized containers was insufficient in the absence of a deeming provision. The activity did not produce a new and distinct commodity with a different name, character or use, and the reasoning applied the principle that a process is not manufacture unless the market-recognised product changes in substance. The finding that manufacture had occurred was set aside and the assessee succeeded.

---

---

Issues: Whether repacking mould release preparation from bulk into small aerosol cans with added propellant gas amounted to manufacture.

Analysis: The activity involved packing the preparation into smaller consumer packs and adding liquid petroleum gas only to facilitate application and use. Mere value addition did not, by itself, establish manufacture in the absence of a deeming provision. The process did not bring into existence a new product with a different name, character or use; only the mode of application changed. The reasoning that blending of lubricating oils does not amount to manufacture where the resultant product is not known differently in the market was applied.

Conclusion: The process did not amount to manufacture and the finding to the contrary was set aside, in favour of the assessee.

Final Conclusion: The appeal succeeded and the order confirming manufacture was annulled.

Ratio Decidendi: Repacking a product into smaller containers with propellant for easier use does not amount to manufacture unless it results in a new and distinct commodity with a different name, character or use or is treated as manufacture by a deeming provision.

---