TaxTMI 
TaxTMI 
1984 (10) TMI 48
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.... strong for the purpose of packaging. Sometimes, two kraft papers are bonded together with bitumin. It is admitted that the kraft paper used for the purpose, has already suffered duty, and so has the bitumin used for the purpose. The question is, whether the bituminised water-proof paper produced by the petitioners is a new commodity, and liable to duty afresh ? In other words, the question is whether the process employed for preparing bituminised water-proof paper, involves 'manufacture' ? It is the common case of both the parties before us that, unless the process employed by the petitioners amounts to 'manufacture', no duty is leviable. It may be noticed that the kraft paper used for the purpose, is used only for wrapping or packaging. T....
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....ican judgment. The passage runs thus - "'Manufacture' implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation ; a new and different article must emerge having a distinctive name, character, or use". Applying the said test, let us see whether the process employed by the petitioners can be said to amount to 'manufacture'... We think not. What all happens is that, a kraft paper which is used only for the purpose of packaging, is bonded with another kraft paper by employing bitumin as a bonding agent. Take a case where a person in his hut or room adopts the same process. He takes two kraft ....
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.... merely coating jute cloth or jute fabric with a solution does not change its character and that, it does not amount to manufacturing new jute goods. The Calcutta High Court pointed out "It is undoubtedly a manufacture of new goods or new kinds of goods, but it is not a manufacture of jute goods". Similarly, the Gujarat High Court held in Nav Gujarat Paper Industries v. Superintendent of Central Excise - 1977 E.L.T. J 67, that manufacturing gummed paper out of duty paid paper, does not amount to manufacture. In that case, the process consisted of applying gum to one side of duty paid paper, and also manufacturingprinted wrappers out of white paper. 3. Now we come to the reasoning of the learned Single Judge, who has taken a contrary view....
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....a change may occur on account of the process employed by the petitioners; but, every change is not 'manufacture', 4. It is also relevant to notice Tariff Item 17(2), as it stood at the relevant time. It read thus : Item No. Description of goods Rate of duty (1) (2) (3) 17. Paper and paper board, all sorts (including paste board, millboard, straw-board, cardboard, and corrugated board), in or in relation to the manufacture of which any process is ordinarily carried on with the aid of power - (1) * * * (2) Paper board and all other kinds of paper (including paper or paper boards which have been subjected to various treatments such as coating, impregnating, corrugation, creping an....