TaxTMI 
TaxTMI 
1999 (2) TMI 74
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.... respondents registering themselves obtaining any licence in respect of the processing of soapnut into soapnut powder, the marking thereof, and also directing them to forbear from insisting upon any return of the transactions in respect of the same being filed by them; etc. Certain quantity of shikakai alongwith soapnut powder produced by the 2nd respondent was seized by the appellants on the ground that the same is liable to levy of excise duty and that duty has not been paid by the manufacturer. Therefore, the writ petition is filed. 3.During the seizure the representative of the 2nd respondent has given a statement, under compulsion. The issue raised in the writ petition is as to whether the soapnut powder/shikakai powder is liable to excise duty under the Customs Tariff for the year 1994-95. He has averred that soapnut powder is manufactured by crushing the shikakai nuts collected from the forest. Their contention is Shikakai and Soapnut powder are the same. The annexures produced by the respondents disclose that the Government has declared that Shikakai or soapnut powder do not come under the category of Item 15-D included in the Finance Act. It was contended by the Departm....
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....en the seeds. The pods of this bush, shikai, are extensively used as a detergent and the dry ones are regularly sold in bazars. In recent years, the powdered pods, sometimes perfurmed, are also marketed. Shikai is preferred to soap when taking an oil bath as it does not leave the skin dry. Soap nut, which has similar properties, is from sapindus species. The pods contain saponin (5%). It is said that they are said to be used in northern Bengal for poisoining fish. 9.The Webster-III New International Dictionary defines `soapnut' as : "Soap nut 1: the seed of a soapberry (Sapindus Saponania) used for making beads and buttons 2: the flat saponaceous pod of an East Indian woody vine (Acacia concinna); also: the plant itself." 10.This is meaning given by the Western dictionary to the word soapberry, but we have to find out how Sige is understood among the Indian masses. The meaning of the word sigekai as per Kannada-English dictionary by Rev. F. Kittel is climbing prickly shrub, the pods of which are used like soap for washing the hair etc., Acacia Concinna DC Note: The soapnut tree is often called sige, but not correctly; the soap nut tree is etc.). 11.It is to be noticed t....
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....ing commodity. 16.The note appended in respect of classification Chapter Note IV reads as follows : "In relation to products of Heading Nos. 33.03, 33.04, 33.05, conversion of powder into tablets, labelling or relabelling of containers intended for consumers or repacking from bulk packs to retail packs or the adoption of any other treatment to render the products marketable to the consumer, shall be construed as `manufacture'." 17.It means that powder should be transformed into some other form as tablets and packed or repacked for the purpose of sale. It contemplates third product manufactured from natural or commercial ingredients. As long as these activities are not there it is not possible to consider that there is a manufacturing activity. In the case of the Shikakai powder the original shikakai (pods) are made into powder by putting labour and undergoing a process, powder is manufactured for the purpose of sale in the market. When powder is made into tablets and packed for the purpose of sale, it amounts to manufacture making pods into powder and packing them in pockets for the purpose of sale amounts to manufacture. 18.It is relevant to refer the case law on the s....
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....r recording the above judgment while considering the word `manufacture' has observed as follows : "The word "manufacture" is defined in Section 2(f) of the Act as including any process incidental or ancillary to the completion of a manufactured product. The rolling of billet into a circle is certainly a process in the course of completion of the manufactured product, viz., circles. In present case, as we have already indicated earlier, the product, that is sought to be subjected to duty, is a circle within the meaning of that word used in Item 26A(2). In the other two cases which came before this Court, the articles mentioned in the relevant items of the First Schedule were never held to have come into existence, so that the completed product, which was liable to excise duty under the First Schedule, was never produced by any process. In the case before us, circles in any form are envisaged as the completed product produced by manufacture which are subjected to excise duty. The process of conversion of billets into circles was described by the legislature itself as manufacture of circles." 21.In AIR 1973 SC 425 (Allenburry Engineers v. Ramakrishna Dalmia) the Supreme Court al....