Manufacture test for processing duty-paid M.S. angles and flats failed; tariff heading change alone did not create excisability.

Mere punching, drilling and galvanising of duty-paid M.S. angles and flats removed to an R&D centre did not amount to manufacture, because the processing did not bring about a new excisable product. A change in tariff heading by itself did not alter that legal position, and the Tribunal followed its earlier rulings on identical processing of the same goods, including the assessee's own case. The duty demand was therefore unsustainable, the impugned order was set aside, and consequential relief was granted.

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Issues: Whether punching, drilling and galvanising of duty paid M.S. angles and flats removed to an R&D centre amounted to manufacture and attracted central excise duty, notwithstanding the tariff heading change.

Analysis: The Tribunal followed its earlier decisions holding that similar processing of duty paid angles and flats does not result in manufacture. It noted that the introduction of a chapter heading in the tariff did not alter the legal position, and that the activity remained non-manufacturing even on identical goods and on the same issue previously decided in the assessee's own case.

Conclusion: The activity did not amount to manufacture and the duty demand could not be sustained. The issue is decided in favour of the assessee.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: Mere punching, drilling and galvanising of duty paid M.S. angles and flats does not amount to manufacture, and a tariff heading change by itself does not convert such processing into excisable manufacture.

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