Re-glass lining as manufacture: fresh lining process after stripping old coating supported denial of refund.

Re-glass lining of old and used glass-lined equipment was treated as manufacture because the returned vessels underwent stripping of the old lining, application of powder glass frit, uniform coating, and firing, resulting in a fresh lining in substance identical to the original lining process. The earlier Supreme Court ruling on re-rubbering and re-lining was read as deciding only that there was no cut-off basis for a departmental change in view, not that such processes can never amount to manufacture. The refund plea on limitation was not pressed, and the refund claim was held not maintainable.

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Issues: Whether re-glass lining of old and used glass-lined equipment amounts to manufacture so as to sustain denial of refund.

Analysis: The glass-lined vessel, as initially cleared, was treated as a distinct excisable product. On return of the used vessels, the same process of applying powder glass frit, achieving uniform coating, and firing in the furnace was carried out after stripping the old lining. The process resulted in a fresh lining and was the same in substance as the original lining process. The earlier Supreme Court ruling on re-rubbering and re-lining did not lay down that such processes never amount to manufacture; it was concerned with the absence of a cut-off basis for a departmental change in view. The refund plea on limitation was not pressed.

Conclusion: Re-glass lining amounts to manufacture and the refund claim was not maintainable.

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