Geometry Box - Whether manufacture?

[sathyanarayanan kasinathan]

sec 2(f) of central Excise Act,1944 defines manufacture as under:-

'manufacture' includes any process,—  

i. incidental or ancillary to the completion of a manufactured product; (See Note 1)

ii. which is specified in relation to any goods in the Section or Chapter notes of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to manufacture; or

iii. which, in relation to the goods specified in Third Schedule involves packing or re-packing of such goods in a unit container or labeling or re-labeling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer,

and the word 'manufacturer' shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account;

7310 or 7326 or any other Chapter - Mathematical boxes, geometry boxes and colour boxes, pencil sharpeners

The geometry box, in our case, is merely assembled using bought out duty-paid goods such as 'pencil', 'compass' etc.
Section 2(f)(iii), which levies duty on the above process is restricted to goods laid out in 'Schedule III' of the Central excise tariff Act, 1985. Third Schedule to the Central excise tariff Act, 1985 does not contain 7310 or 7326 or any other Chapter.

Invite your views on the matter.

[Jayant Kuvelkar]

New product 'geometry box' has emerged out of assembly of pencil,compass etc. which is clearly 'manufacture' under excise.

[Dhirendra Srivastava]

In my view, since Geometry box contains, Compass, Scales of various dimentions, Pencil, Sharpmer etc, therefore all these components are available in market in isolation and they are sold independently aslo .So in my view it will not amount to manufacture.

Looking for other views

 

[Mahir S]

 As there are no activities such as drawing/redrawing, packing/repacking and only Assembling of goods is being done here, ( that too of bought out duty paid goods), hence no manufacturing activity is undertaken herein.

[sathyanarayanan kasinathan]

Appreciate all replies. Looking forward ot reading more opinions.

Thank You

AI Summary

Manufacture definition under Central Excise: assembly of bought out components may not qualify as manufacture absent processing. Whether assembling bought out duty paid stationery into a geometry box amounts to manufacture under section 2(f) of the Central Excise Act is disputed. Section 2(f)(iii) captures packing/repacking and related treatments only for goods listed in the Third Schedule to the Central Excise Tariff Act; the geometry box and its tariff headings are not in that Schedule. One view regards the assembled geometry box as a new manufactured product; the opposing view treats mere assembly of market available components without processing or packing alterations as not constituting manufacture.