Manufacture test for fibre cutting under tariff law led to grant of stay in favour of the assessee.

Cutting fibres into lengths not exceeding 5 mm was examined as a possible manufacturing process requiring RG-1 entry under Section 2(f) and the relevant Chapter Notes. The Tribunal noted that a process attains the character of manufacture only if the tariff scheme specifically treats it as such, and found that the department had not shown that fibre cutting was specified as a manufacturing process for goods under Heading 5601.00. On that prima facie basis, the assessee's position was regarded as requiring protection pending further consideration, and stay of the impugned order was granted.

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Issues: Whether the process of cutting fibres into lengths not exceeding 5 mm was, on the materials before the Tribunal, a process amounting to manufacture so as to require RG-1 entry and justify continuance of the departmental order.

Analysis: The Tribunal noted that the stage of manufacture must be determined with reference to Section 2(f) and the relevant Chapter Notes, and that a process would assume the character of manufacture if it was specifically treated as such under the tariff scheme. On the departmental showing, it could not be demonstrated that cutting of fibres had been specified as a manufacturing process for goods falling under Heading 5601.00. The Tribunal therefore formed a prima facie view that the assessee's contention required protection pending further consideration.

Conclusion: The prayer for stay of operation of the impugned order was granted in favour of the assessee.

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