Mere repacking does not amount to manufacture where no new commodity emerges; central excise demand on the repacker fails.

Repacking kum kum from bulk containers into retail packs did not amount to manufacture for central excise purposes because the product was already fully manufactured and the activity did not create a new commodity with a distinct name, character or use. Mere change of packing, without any incidental or ancillary process establishing manufacture, was insufficient to fasten duty liability on the respondents. The duty position remained linked to the original manufacturer, and the demand raised against the respondents was therefore unsustainable.

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Issues: Whether repacking kum kum from bulk containers into retail containers amounted to manufacture for central excise purposes and, if not, whether the duty demand against the respondents could be sustained.

Analysis: The goods were already fully manufactured by the upstream producer and were received only for repacking. On the facts, the activity undertaken by the respondents did not bring into existence a new commodity with a distinct name, character or use. The process was merely a change in packing of an already manufactured product, and no incidental or ancillary manufacturing process was established. The exemption position and duty liability therefore remained with the original manufacturer rather than the respondents.

Conclusion: Repacking of kum kum from bulk to retail packs did not amount to manufacture, and the demand raised against the respondents was unsustainable.

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