Deeming manufacture under Chapter 32 applied where dye processing created ready-for-use formulated products, overriding the new-commodity test.

Note 6 of Chapter 32 deems conversion of unformulated, unstandardised or unprepared synthetic organic dyes into formulated, standardised or prepared dyes ready for use as manufacture. The controlling question was whether market-purchased synthetic coal tar dyes became ready for use only after dilution, mixing, reduction in strength or similar treatment. The note's express deeming fiction prevailed over the general test that manufacture requires emergence of a new commodity. On that basis, the processing brought the goods within the statutory definition of manufacture, and the resulting goods were classifiable under sub-heading 3204.29.

---

---

Issues: Whether the processing of market-purchased synthetic coal tar dyes by dilution, mixing, reduction in strength, or similar treatment amounted to manufacture under Note 6 of Chapter 32 of the Central Excise Tariff Act, and whether the resulting goods were classifiable as formulated, standardised, or prepared dyes ready for use.

Analysis: Note 6 of Chapter 32 creates a specific deeming rule that conversion of unformulated, unstandardised, or unprepared forms of synthetic organic dyes into formulated, standardised, or prepared forms ready for use in dyeing amounts to manufacture. The decisive question was whether the goods purchased from the market were already formulated or whether they became so only after processing. The expression "ready for use" was treated as the controlling feature of the note. The process of adding diluents, reducing concentration, or mixing dyes to obtain a particular shade was held to bring the goods within the statutory definition, and the general concept that manufacture requires emergence of a new commodity was held not to override the express deeming provision.

Conclusion: The processing undertaken by the assessee amounted to manufacture under Note 6 of Chapter 32, and the goods were classifiable under sub-heading 3204.29.

Final Conclusion: The exemption-like contention based on the goods already being formulated dyes failed, and the departmental appeal succeeded on the classification and manufacture issue.

Ratio Decidendi: Where a tariff entry or chapter note expressly deems specified treatment of a product to be manufacture, that statutory fiction prevails over the general test of emergence of a new commodity, and processing that converts dyes into ready-for-use formulated forms falls within manufacture.

---