Mere cutting of tanned leather into straps is not manufacture when no new commercially distinct product emerges.

Cutting tanned leather into customer-specified lengths and straps did not amount to manufacture because the process did not alter the essential character of the leather or bring into existence a new, distinct commercially identifiable product. The cut pieces retained their identity as tanned leather straps, so classification could not be changed on the footing of manufacture under Section 2(f). The exemption applicable to tanning industry goods therefore remained available, and the Revenue's challenge failed.

---

---

Issues: Whether cutting tanned leather into specified sizes and straps amounts to manufacture so as to deny exemption and justify classification as a different excisable product.

Analysis: The respondents were recognised tanners and merely cut tanned leather into lengths and sizes according to customer specifications. The process did not alter the essential character of the leather, did not bring into existence a new and distinct product, and did not result in any change of identity or nomenclature. The authorities cited by the Revenue involved processes where the original commodity underwent transformation into goods with a different commercial identity, which was not the position here. As the cut pieces continued to remain tanned leather straps, the process was not manufacture within the meaning of Section 2(f). The exemption notification applicable to tanning industry goods therefore remained available.

Conclusion: The cutting of tanned leather into straps and sizes did not amount to manufacture and the exemption was rightly allowed; the Revenue's appeal failed.

Ratio Decidendi: Mere cutting of tanned leather into specified sizes, without bringing into existence a new and distinct commercially identifiable product, does not constitute manufacture.

---