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of <h1>Appellate Tribunal rules repacking not manufacturing under Central Excise Act. Precedent set on proper classification.</h1> <h3>MEGHAMANI ORGANICS LTD. Versus COMMR. OF CUS., C. EX. & ST., HYDERABAD</h3> MEGHAMANI ORGANICS LTD. Versus COMMR. OF CUS., C. EX. & ST., HYDERABAD - 2010 (254) E.L.T. 172 (Tri. - Bang.) Issues:Classification of repacked micronutrients under Central Excise Act, 1944.Analysis:The judgment by the Appellate Tribunal CESTAT Bangalore involved appeals regarding the repacking and relabeling of micronutrients without payment of duty, deemed as manufacturing under the Central Excise Act, 1944. The Revenue alleged that the repacked product 'Librel' fell under Chapter Heading No. 29224995 of the Central Excise Tariff Act, 1985, making it marketable to consumers. The Adjudicating Authority confirmed duty demands, penalties, and interest. The appellants contended that the product was classified differently under the Customs Tariff Act. The issue revolved around whether the repacking process constituted manufacturing under Chapter Note of Chapter 29. The Co-ordinate Bench previously classified the product under Chapter Heading 3105.90, supporting the appellants' argument. The Tribunal noted that Chapter 31 lacked a provision deeming repacking as manufacturing, leading to the conclusion that the activity did not amount to manufacture. Following precedent, the Tribunal set aside the impugned orders and allowed the appeals.The judgment highlighted the importance of proper classification under the relevant tariff acts. The Tribunal's decision was based on the interpretation of chapter notes and previous rulings, emphasizing the need for consistency in classification. The absence of a specific provision deeming repacking as manufacturing under Chapter 31 was a crucial factor in determining the appellants' liability. The reliance on precedents and expert opinions regarding the nature of the product further strengthened the Tribunal's decision to set aside the duty demands and penalties. The judgment serves as a precedent for similar cases involving the classification and taxation of repacked goods under excise laws, providing clarity on the scope of manufacturing activities in such scenarios.
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