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1987 (12) TMI 278

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..... the batteries are inserted; the two layers of film are then bonded together, with the batteries sealed inside. This is said to be the best packing for the battery as it insulates it from atmospheric pollution, moisture, air, dust etc. and keeps it in condition for a much longer time. According to the learned counsel Mr. Lakshmi Kumaran, without this packing the battery cannot reach its customers, and therefore, the battery is not completed until it is packed in strip packing of cello poly film. Hence, he said they are entitled to the exemption under the notification No. 201/79-CE which allows exemption for all excisable goods, in the manufacture of which any goods falling under item 68 of the first schedule of the Central Excises and Salt .....

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..... ake an alternative plea. If notification 201/79-CE does not find favour with the bench, he should be allowed proforma credit under Rule 56A of the Central Excise Rules as under this scheme they can get adequate compensation for the duty paid on the raw material. 6. The learned counsel for the department began by pointing out that the notification 201/79-CE was a self contained notification and its words were different from 56A scheme. Furthermore, cello poly film has not been listed in 56A. It cannot be said that a film used for packing becomes an input or a raw material. He pointed to the words in the manufacture of which which occur in notification 201/79-CE. They mean that the manufacture must be made with these films as inputs and .....

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..... d counsel for M/s. Union Carbide reiterated his contention that the batteries cannot be sold without the pack. This, however, is a mistaken notion. The battery can be sold without the film pack and batteries are frequently sold and can be bought without the film pack. Some companies wrap them in such film wrappers as they provide secure protection against loss of current, damage etc. but it will not be correct to say that the batteries cannot be sold without the film pack. As I have said batteries can be bought without the film pack, and in fact batteries are still sold without any film pack. 10. It would be a mistake in my opinion to see cello poly film as an input used in a manufacture of a battery or as a raw material or component par .....

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..... the input or the raw material. In this respect we can learn much from the judgment of the Supreme Court in JK Cotton Spinning Mills quoted by the learned counsel for M/s. Union Carbide. 12. Here is a sentence that in my opinion provides the complete answer : Where any particular process is so integrally connected with the ultimate production of goods that but for that process, manufacture or processing of goods would be commercially inexpedient, goods required in that process would, in our judgment, fall within the expression in the manufacture of goods . 13. The Supreme Court also observed at page 569 : the expression in the manufacture takes in within its compass all processes which are directly related to the actual productio .....

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