TaxTMI 
TaxTMI 
2011 (8) TMI 93
X X X X Extracts X X X X
X X X X Extracts X X X X
....he findings of the Commissioner(Appeals). 2. The issue which falls for consideration in the present appeal is whether the treatment given or the process undertaken by the appellant to Helium gas purchased by it from the open market would amount to manufacture, rendering the goods liable to duty under Chapter Note 10 of Chapter 28 of the Central Excise Tariff Act, 1985 (hereinafter referred to as The Act'). Chapter Note 10 of Chapter 28 of The Act, In Relation To manufacture', reads as under:- "10. In relation to products of this chapter, labelling or relabelling of containers and repacking from bulk packs to retail packs or adoption of any other treatment to render the product marketable to the consumer shall amount to m....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... appellant it was vehemently argued that the appellant had only conducted various tests like moisture test, etc. to determine quality and quantity of Helium gas in the cylinders. It was further submitted that even after the activity of testing, Helium gas remained as Helium gas only and there was no change in the chemical or physical properties. No new product, other than Helium gas came into existence and, therefore, it cannot be said that the appellant had carried on any manufacturing activity. 5. It was further submitted that the gas, when purchased by the appellant, was already marketable and, therefore, it cannot be said that the testing of the gas by the appellant had rendered the product marketable. In the circumstances, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uance of a separate certificate along with cylinder at the time of sale containing all the details regarding moisture, purification, etc. amounted to re-labelling of the gas cylinders. He also submitted that the revenue authorities were fully justified in invoking the extended period of limitation as there had been willful suppression of facts on the part of the appellant with an intent to evade payment of duty. 8. We have heard the learned counsel for the parties and perused the records. In view of Chapter Note 10 to Chapter 28 of the Act, the manufacturing activity would mean either:- (a) Labelling or re-labelling of containers and repacking from bulk packs to retail packs; or (b) An adoption of any other tre....
X X X X Extracts X X X X
X X X X Extracts X X X X
....horities were not informed as to what was being done by the appellant to Helium gas purchased or what treatment was given to the said gas before selling the same to different customers at different rates with different certifications in different containers/cylinders. It is also pertinent to note that the gas which was purchased at the rate of about Rs.520/- per Cum. was sold by the appellant at three different rates namely Rs.700/-, Rs.826/- and Rs.1000/- per Cum. and thereby the appellant used to get 40% to 60% profit. 12. From the above undisputed facts, it is clear that the gas cylinders were not sold as such but they were sold only after certain tests or processes as specified by the customers of the appellant. It is also cle....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... officer of the appellant, he could not offer any cogent answer but merely stated that it was the customers' preference. Further, he did not give proper answer as to how the profit margin was so high. The appellant had supplied the gas not as such and under the grade and style of the original manufacturer but under its own grade and standard. Further, while selling the gas, different cylinders were given separate certificates with regard to the pressure, moisture, purification and quality of the gas. This explains the high price at which the appellant was selling the gas. 15. Therefore, in our opinion, the Tribunal has rightly observed that if no treatment was given to the gas purchased by the appellant, customers of the appellant....
X X X X Extracts X X X X
X X X X Extracts X X X X
....not possess earlier. 19. Therefore, the phrase "marketable to the consumer" would naturally mean the marketability of the product to "the person who purchases the product for his own consumption". Hence, the argument of the appellant that as the product was already marketable, the provisions of Chapter Note 10 of Chapter 28 of the Act would not be attracted, will have to be rejected. 20. For the aforetasted reasons, we agree with the Tribunal in holding that the appellant is liable to pay excise duty for the reason that it has manufactured Helium within the meaning of the term Manufacture' as explained in terms of Chapter Note 10 of Chapter 28 of the Act. 21. So far as the issue with regard to relabelling is co....