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2016 (10) TMI 274 - HC - Central ExciseManufacture - change in tariff heading after processing - activities for processing TMT coils into TMT bars/rods after de-coiling, straightening and cutting into size - Held that:- no error has been committed by the Customs, Excise and Service Tax Appellate Tribunal - conversion of TMT coils into TMT bars and TMT rods is not manufacturing at all, even if, these two items are mentioned under different Sub-Headings of the Central Excise Tariff Act, 1985 - merely because there is value addition, it does not mean that manufacture has taken place. Whether the activities for processing TMT coils into TMT bars / rods after de-coiling, straightening and cutting into size amounts to manufacturing process - Held that:- to ascertain as to whether the manufacturing process has taken place or not, a test is to be applied, whether change or series of changes take the commodity to a point where commercially it can no longer be regarded as the original commodity, but, instead is recognized as a new and distinct article that has emerged as a result of processes then a manufacture can be said to have taken place. This is the test to be applied for arriving at a conclusion whether the process applied upon the product amounts to manufacturing or not. It has been held by the Hon'ble Delhi High Court in the case of Faridabad Iron & Steel Trader Association Vs. Union of India [2003 (11) TMI 107 - HIGH COURT OF DELHI] that while examining justifiability of Excise Duty we must clearly comprehend that Excise Duty can be imposed on the manufacture of goods produced in India and that also on the bringing into existence a new substances known to the market. In view of the settled position of law crystallized by the various judgments, we have no difficulty in clearly arriving at the conclusion that mere cutting or slitting of steel sheets does not amount to manufacture because the identity of the product remains unchanged. The steel folded in coil remains steel even after cutting. No new, different and distinct article emerges having distinct name, character and use. Therefore, mere cutting and slitting would not amount to manufacture. We are also clearly of the view that merely because of change in tariff item, the good does not become excisable. Therefore, by following the same, the activities for processing TMT coils into TMT bars / rods after de-coiling, straightening and cutting into size does not amounts to manufacturing process. - Decided against the Revenue
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