2021 (10) TMI 933

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.... of the Central Excise Tariff Act, 1985. As a part of its endeavor to improve and test the quality of cigarettes, the appellant at times purchase the duty paid cigarettes manufactured by its competitors from open market for testing purposes. The competitor's cigarettes so procured are masked covering the competitors brand name, repacked in new pack carrying only a code number and thereafter removed for testing purpose to select panel of discerning smokers without payment of duty. In addition to the above activity, the appellant also cleared its own manufactured cigarettes for testing purpose on payment of appropriate Central Excise duty. Non-payment of duty on removal of competitor's cigarettes was objected to by the department on the groun....

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.... Heard both sides and perused the records. 6. The term "manufacture" has been defined under Section 2(f) inter alia, to include any process, incidental or ancillary to the completion of a manufactured product. In this case, the competitor's cigarettes procured by the appellant were masked, covering the manufacturer's brand name, repacked in new pack by putting only a code number for testing purpose to select panel of the smokers. The product emerged after carrying out the activity of masking, putting code number etc. for identification, remained cigarettes only, which were procured by the appellant on payment of appropriate Central Excise duty. Since, there was no change in the name, character and use of the originally bought-out....