Site fabrication of steel structural members is not manufacture absent a new, distinct and marketable commodity.

Cutting, drilling, punching, welding and site assembly of duty-paid steel channels and angles to form columns, beams, trusses and purlins does not amount to manufacture when the process merely adapts standard steel sections for a particular use. The controlling test applied was whether a new, distinct and marketable commodity comes into existence; on these facts, it did not. The fabricated structural members were therefore not excisable goods under Heading 7308, and the duty demand and classification were set aside.

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Issues: Whether fabrication of columns, beams, trusses, purlins and similar structural members from duty-paid channels and angles by cutting, drilling, punching, welding and assembling at site amounts to manufacture and results in excisable goods classifiable under Heading 7308.

Analysis: The structural members were made from duty-paid steel sections by cutting, drilling, punching and welding, and were then assembled and erected at site in the exact required position. The controlling principle applied was that such work only adapts standard steel products for a particular use and does not bring into existence a new, distinct and marketable commodity. The earlier view that trusses, purlins, columns and similar structurals are not separate goods was accepted, and the later decisions cited by the Revenue were treated as either distinguishable or as not having displaced that principle.

Conclusion: The fabrication process did not amount to manufacture and the items were not excisable goods under Heading 7308.

Final Conclusion: The duty demand and classification adopted in the impugned order were set aside, and the appeals succeeded.

Ratio Decidendi: Mere cutting, drilling, punching, welding and site assembly of steel sections for use as structural members does not amount to manufacture unless a new, distinct and marketable commodity comes into existence.

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