Manufacture test for recovered tartaric acid failed where processing did not create a new commercially distinct excisable product.

Recovery of tartaric acid from L2 ABT did not amount to manufacture because the process did not bring into existence a new commercially known commodity with a distinct name, character or use. On the evidence, the activity was treated as recovery rather than transformation, and the product remained tartaric acid. As no new excisable product emerged, central excise duty was not attracted and the duty demand was unsustainable.

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Issues: Whether the process undertaken on L2 ABT amounted to manufacture of tartaric acid so as to attract central excise duty.

Analysis: The process was found, on the evidence of unrebutted affidavits and the materials on record, to be one of recovery of tartaric acid from L2 ABT and not the bringing into existence of a new product. The essential test applied was whether a new and different commercially known commodity, having a distinct name, character or use, emerged after processing. Since the product remained tartaric acid and no commercially distinct new commodity arose, the activity did not amount to manufacture.

Conclusion: No excisable manufacture took place and no duty liability arose on the recovered tartaric acid.

Final Conclusion: The Revenue's challenge failed because the process was held not to create a new excisable product, and the duty demand was unsustainable.

Ratio Decidendi: Recovery or purification of a substance does not amount to manufacture unless the process results in a commercially distinct product with a new name, character or use.

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