TaxTMI 
TaxTMI 
1985 (3) TMI 76
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....ntions several products of which we are concerned with a product called by name Polyurethane Foam. Normally, the above said product - which is one of the excisable goods within the meaning of Section 3 of the Central Excise Act - is produced or manufactured within the factory premises. The goods so manufactured are normally dispatched as Polyurethane Foam. There is no dispute that the production of such Polyurethane Foam is subject to the excise-duty leviable by reason of Section 3 of the Central Excise Act read with Item 15-A of the First Schedule. But, the present controversy relates to the manufacturing activity of the petitioner-Company carried on outside its factory located at Hyderabad and in ships, docks and ports like Visakhapatam. ....
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....se. Prima facie, therefore, polyurethane foam produced in the ship through 'one-shot' process should be regarded as an excisable commodity subject to the levy and collection of duties of excise. But, the argument of the learned counsel for the petitioner is that before a commodity can be called an excisable goods it should have been brought into existence by process of manufacture and that, it should be an economical commodity as understood in the popular parlance. In examining this matter without reference to any decided cases, it must be held that polyurethane foam which is produced in the ship by 'one shot' process is clearly a result of manufacturing operation. In the manufacture of Polyurethane Foam in the ship various chemicals were u....
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....s use as conductor has been held to be not a manufacturing process cannot have any application to the facts of the present case. Similarly, the judgment reported in Vijay Textiles, Nerol Abendaly v. Union of India (2) 1979 E.L.T. (J181), holding that the process of making cotton fabric, or man made fabric, does not bring into existence any new woven - stuff or woven substance, will be of no application to the facts of this case. There the question was whether a fabric which is already woven and was in existence but was subjected to a process resulted in the manufacture of cotton fabric or, any manufacture of man-made fabric? In answering that question in the negative, the Gujarat High Court relied upon the meaning of the word 'fabric' as co....
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....le commodity. We find that case has no bearing on the question with which we are concerned here. Polyurethane Foam produced by the petitioner and fixed in the ship is not only an end-product but is so understood in the popular parlance. 7. The next decision of the Supreme Court in Ramavatar v. Assistant Sales Officer's case, on which the petitioner has placed reliance, is not also of much use to the petitioner. In that case, the Supreme Court was concerned with the question whether betel leaves, which were specially enumerated for the purpose of sales tax, should be treated as vegetables and granted exemption? The Supreme Court negatives that contention. 8. The judgment of the Delhi High Court in D.C.M. v. Joint Secretary is a case wh....
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....s held not to be calcium carbide within the meaning of tariff item 14 AA because it has no utility and also because it has no exchange value and also because, Law forbids sale of such commodity. We find, applying the above three tests to the product Polyurethane Foam produced or manufactured by the petitioner in this case, that Polyurethane Foam is an excisable commodity. It has exchange value and no Law forbids its sale. The mere fact that the product is fixed cannot make the goods 'Non-excisable goods'. We accordingly find that Polyurethane Foam manufactured or produced by the petitioner through 'one-shot' process insitu in the ship is an excisable article. 9. The Judgment of the Punjab High Court in M/s Jiwan Singh v. The Senior Super....