Tribunal rules profile cutting as manufacturing under sub-heading 7326.90, upholds duty demand.

The Tribunal upheld the classification of goods under sub-heading 7326.90, ruling that the activity of profile cutting constituted manufacturing. The goods were deemed marketable as they were sold to customers, and the limitation defense was rejected due to concealment of the manufacturing process. The appeals were dismissed, affirming the duty demand and penalties imposed on the appellants.

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Issues Involved: Classification of goods under sub-heading 7326.90 of CETA, whether the activity of profile cutting amounts to manufacture, marketability of the manufactured goods, classification of goods, and limitation of duty demand.

Classification of Goods: The adjudicating authority classified the goods as M.S. Profiles, Circles, Squares, and Rings under sub-heading 7326.90 of the CETA. The appellants argued for classification under sub-heading 7208.11 or 7208.99, claiming no manufacturing process was involved. However, the Tribunal upheld the classification under sub-heading 7326.90, considering the distinct nature and use of the goods compared to Plain M.S. Plates.

Manufacture vs. Activity of Profile Cutting: The appellants contended that their activity of converting Plain M.S. Plates into various M.S. Profiles did not amount to manufacture as no new distinct product emerged. Citing legal precedents, the Tribunal disagreed, stating that the conversion process resulted in the creation of new and distinct commodities with different uses, thus constituting manufacturing under the law.

Marketability of Goods: The appellants argued that the manufactured goods were not marketable, thus not subject to duty. However, the Tribunal found that the goods, including M.S. Profiles, Rings, Circles, Angles, and Channels, were sold to customers against payment, establishing their marketability. Legal precedents were cited to support the view that marketability does not depend on widespread availability but on the ability to sell to customers.

Limitation of Duty Demand: The issue of limitation was raised, with the appellants claiming the demand was time-barred. The Tribunal rejected this argument, stating that the appellants concealed the manufacturing process from the Department, invoking the extended period of limitation. Legal precedents were cited to support the decision to uphold the duty demand and penalty imposition due to prolonged duty evasion.

Conclusion: The Tribunal upheld the impugned order, dismissing the appeals as lacking merit. The classification of goods under sub-heading 7326.90, the activity of profile cutting being considered as manufacture, the marketability of the goods, and the rejection of the limitation defense were all addressed in detail, leading to the dismissal of the appeals and affirmation of the duty demand and penalties imposed on the appellants.

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