Manufacture of hydrogen gas cylinders not established where filtration, drying and filling merely made the product marketable.

Filtering, drying and filling hydrogen gas into returnable cylinders to make it marketable did not, by itself, amount to manufacture. The Tribunal followed its earlier decision in the same assessee's case, as affirmed by the Supreme Court, and held that the process of receiving gas through a pipeline, removing moisture and packing it into cylinders did not create a new manufactured product. The duty demand, interest and penalty therefore could not be sustained, and the impugned order was set aside with consequential relief.

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Issues: Whether the filling and repacking of hydrogen gas cylinders by the appellant amounted to manufacture so as to sustain the duty demand, interest and penalty.

Analysis: The dispute turned on whether the process of receiving hydrogen gas through pipeline, removing moisture by filtration and drying, and filling the gas into returnable cylinders rendered the product marketable in a manner amounting to manufacture. The Tribunal followed the earlier decision in the appellant's own case, as affirmed by the Supreme Court, which held that the process of filling hydrogen gas cylinders to render the product marketable did not amount to manufacture.

Conclusion: The process did not amount to manufacture, and the demand of duty, interest and penalty could not be sustained. The appeal was therefore allowed and the impugned order was set aside with consequential relief as per law.

Ratio Decidendi: A process that merely filters, dries, and fills gas into cylinders to make it marketable does not, by itself, constitute manufacture.

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