Scouring of wool is not manufacture where the process leaves wool commercially and materially unchanged.

Removal of greasy matter from raw wool by washing with hot water, soap or similar agents was treated as a process that does not bring about a transformation into a new and distinct commodity. Relying on prior Tribunal reasoning, scoured wool was regarded as remaining wool in its material form, and departmental clarification was noted as supporting the inclusion of scoured wool within raw wool. On that basis, scouring was held not to amount to manufacture, and scoured wool was treated as not separately chargeable to duty under Tariff Item 68.

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Issues: Whether scouring of wool amounts to manufacture so as to attract excise duty under Tariff Item 68.

Analysis: The appeal turned on whether removal of greasy matter from raw wool by washing with hot water, soap or similar agents brings about a transformation resulting in a new and distinct product. The prior Tribunal decision relied upon held that scoured wool remains wool in its material form and that the process does not produce a new excisable commodity. The departmental clarification referred to in that decision also treated raw wool as including scoured wool, supporting the view that the process did not create a separately dutiable product.

Conclusion: Scouring of wool does not amount to manufacture and scoured wool is not chargeable to duty under Tariff Item 68. The issue is decided in favour of the assessee.

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