1996 (2) TMI 460

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....eeding the exemption limit under Notification No. 175/86. 3. Arguing for the appellants ld. Advocate submits that what they manufacture is non-sterile sutures leviable to duty under Heading 4201.90 and the same is exempted from duty under Notification No. 279/88, dated 16-11-88. They send these pouches to B.A.R.C. and Shri Ram Institute of Industrial Research for the purpose of sterilisation as they have no equipment for sterilisation. The excise duty if at all was payable by these Institutes since it is at that stage non-sterile catguts became excisable through process of sterilisation. Admittedly they receive back these pouches after sterilisation and they re-pack them for sale but that by itself would not result into manufacture. I....

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....the purpose of further packing these goods. Labels on the small cartons in the form in which the goods were sold clearly indicates that the goods are manufactured by the appellants. These also bore on themselves the batch No. etc. The ownership of the goods throughout remains with the appellants and after receipt of goods the appellants not only re-pack the goods but are also required to carry out certain tests. All this indicates that the actual manufacturer was only the appellant and the two Institutes only carried out a certain process. After carrying out sterilisation the goods did not become marketable at the premises of these Institutes since these goods, according to letters from these Institutes themselves, had to be subjected to fu....

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....cked into individual pouches. These pouches were sent for sterilisation to B.A.R.C., Bombay and Shri Ram Institute for Industrial  Research, Delhi. The sterilisation process took 15 to 20 days. After the material was received back, the same was repacked in final packings for dispatches. They paid Rs. 300/-per box weighing approx.14 kgs. Each". 9. From this it is clear that they are engaged in manufacture and sale essentially of sterile surgical catguts where process of sterilisation was conducted at Shri Ram Institute for Industrial Research and B.A.R.C. In fact, the record indicates that they had also a Drug licence for the manufacture of sterile surgical catguts. The sample which was produced before us clearly indicates on the ....