AI Drafter 
TaxTMI 
TaxTMI 
1984 (6) TMI 221
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....s filed price lists Nos. 3/80 to 6/80. While giving his approval to the price lists, the Assistant Collector, Jabalpur ordered on 26-8-1980 that "wrapping paper used in packing reams/reels and reel core on which the paper is wound are packing materials. The cost of such packing shall be included in the assessable value of paper as per adjudication order No. V(17)3-3/76/24689-90 dated 25-11-1976 passed by the Assistant Collector of Central Excise, Jabalpur". The matter was pursued in appeal. The appellant also took up the plea that if the cost of packing was to be so included, then proforma credit (under Central Excise Rule 56A) of the duty already paid on the wrapping paper consumed for wrapping within the factory should be allowed. The App....
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....le 56A. (v) The Collector (Appeals)'s decision to the effect that the value of the wrapping paper used in wrapping/packing of other varieties of paper/board is to be included in the value of the wrapped or packed contents has not been challenged by the appellant by way of appeal. 3. On behalf of the Respondents, the learned Consultant submitted that- (i) Packing/wrapping is a process of manufacture. That packing is an integral process of manufacture is supported by the Supreme Court decision in 1983 E.L.T. 1896. (ii) The decisions in 1979 E.L.T. 461 and 1978 E.L.T. 18 were in the context of post-manufacturing expenses. The decision of the Madras High Court in Seshasayee Paper and Boards case - 1984 E.L.T. 3 was in the Respo....
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....uct is brought into the factory and distributed therefrom without undergoing any processing or manufacture. The packing/wrapping paper herein were already manufactured. No other goods were manufactured using them. Nor were they distributed from the factory as such. 5. In response to a query from the Bench, both sides stated that there was no decision of the Supreme Court direct on the point at issue in the present case. 6. The learned Senior Deptt. Representative has vehemently contended that packing or wrapping is not a process of manufacture. Hence, packing or wrapping paper cannot be said to have been used in the manufacture of other varieties of paper. Consequently, Rule 56A is not applicable in respect of the duty paid ....
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....r duty. The third decision is that of Madras High Court in E.I.D. Parry Ltd. and and Anr. v. Union of India [1978 E.L.T. (J 18)]. In that case, the stocks of fertilizers held on the eve of the imposition of excise levy on fertilizers was charged to duty on the ground that the goods were not, on the relevant date, packed and ready for delivery. The Court held that packing of fertilizers in gunny bags did not amount to a process incidental or ancillary to the completion of the manufactured product, viz. fertilizers. 7. On the other hand, the learned Consultant of the Respondents has relied upon the decision of the Madras High Court in Seshasayee Paper & Boards Ltd., Erode v. Appellate Collector of Customs & Central Excise, Madras &....
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....rer receiving duty paid materials or component parts or finished product (like asbestos cement) in his factory for the manufacture of the specified goods or the more convenient distribution of the finished product. According to the SDR, the duty paid finished product must itself be cleared out of the factory after re-packing, etc. Such was not the case here. 8. Another decision cited before us is that of the Madras Bench of this Tribunal on the very same issue in the case of Collector of Central Excise, Hyderabad v. Bhadrachalam Paper Board Ltd. (1983 E.L.T. 2090) in which the Bench, by its decision dated 30-7-1983, held that the benefit of Rule 56A was not available for wrapping paper which was not used for its own convenient distr....
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....onsidered for the purpose of including its cost in the assessable value of an excisable article should be spelt out from the definition of manufacture in Section 2(f) of the Act and that the expression "manufacture" is related to the taxable event and refers to a process which enters into the character of an article while packing has been defined by Section 4 in relation to the assessable value of the article. In other words, the Court does not seem to have pronounced specifically on the point whether, in a given situation, packing would amount to "manufacture". 9. Special Bench "D" of this Tribunal in Appeal No. 1418/81-D in the case of Collector of Central Excise, Calcutta v. Kanoria Jute Mills, Calcutta, by Order No. 146/84-D, da....