Repacking without transformation is not manufacture under central excise when statutory deeming conditions are absent.

Repacking bulk epoxy resin, hardeners and colours into smaller containers, without any change in identity, character or use, was treated as a mere packaging activity and not manufacture under the Central Excise Act, 1944. The deeming fiction for packing or repacking applied only where the goods were covered by the relevant statutory schedule or chapter note, which was not the case here. Classification provisions for tariff entry could not, by themselves, convert the activity into manufacture. The demand based on a manufacture theory was therefore unsustainable.

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Issues: Whether repacking of bulk epoxy resin, hardeners and colours into smaller containers amounted to manufacture under the Central Excise law.

Analysis: The activity involved purchase of marketable goods in bulk and their mere transfer into smaller containers without any transformation in identity, character or use. Such repacking did not amount to an incidental or ancillary process of manufacture under Section 2(f) of the Central Excise Act, 1944. The deeming fiction of manufacture for packing or repacking applied only where the goods fell within the relevant statutory schedule or chapter note, which was not the position here. Classification provisions relied upon for tariff entry could not by themselves convert the activity into manufacture.

Conclusion: The activity did not constitute manufacture and the demand based on that premise was unsustainable.

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