TMI Blog2007 (3) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... he period March 1997 to January 2000, they had imported certain additives in barrels with the foreign-supplier's brand name and had sold the same under dealer's invoices to their customers in India after adding their own name, address and brand name to the label on the barrels. Test certificates on samples drawn from the imported goods had also accompanied the goods in barrels so sold by the respondents. As the party considered this activity to be a trading activity, they did not pay duty of excise on the above clearances. After conducting investigations into the above activity of the respondents, the department issued three show-cause notices for the periods March'97 to Jan'99, Feb'99 to Aug'99 and Sept.'99 to Jan 2000 alleging mainly that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iv) The imported additives were then sold under dealer's invoice accompanied by a test certificate. (v) Customers insisted on receiving the additives only after inscription of IAL's name and other particulars in the barrels. (vi) In terms of Chapter Note 5 of the Chapter 38 "operations like label ling re-labelling branding/re-branding or adoption of any other treatment on the said product to make them marketable would amount to manufacture (vii) In view of the fact that IAL indulged in operations like sample testing re branding changing the name and address name of the product etc., to make them accepted by customers, such activities would very will be within the definition of "manufacture" as per the Chapter Note above. The imported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied on by the lower authority, ld. SDR submitted that the same had been withdrawn by CBEC in Circular No. 576/13/2001-CX. dt. 16-5-2001. She claimed that such withdrawal had retrospective effect so that the present issue required to be settled in the light of the Board's circular dated 16-5-2001. 4. On the other hand, ld. Counsel, relying on the Apex Court's judgment in Paper Products Ltd. v. Commissioner, 1999 (112) E.L.T. 765 (S.C.), submitted that the earlier instructions of the Board would govern determination of the question whether the activity undertaken by the respondents on the imported goods during the period of dispute (March'97 to Jan'2000) amounted to manufacture and that the contra instructions contained in circular da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder :- "Doubts have been raised regarding the excisability of imported finished medicines including life-saving drugs exempted vide Customs Notification No. 13/95-Customs, which are marketed by the assessees, in the country. The matter has been examined and it is fit that the assessees while pasting stickers on the cartons of these imported medicines are in fact trying to comply with the requirements of the Drugs and Cosmetics Act, 1940 and are not altering any information originally contained in the packages. The Board has also taken note of the opinion of the Drug Controller of India that re-labelling as done by the assessees is necessary to meet the requirements of Rule 96 of the Drugs and Cosmetics Rules, 1945. Attention is also draw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the period prior to 16-5-2001. This position is well sup ported by the Apex Court's ruling in Paper Products (supra). In that case, the products of the assessee were to be treated as products of the printing industry and not that of the packaging industry as per Board's circular dated 23-7-1986 as further clarified by circular dt. 7-8-1987. The Board changed its view and, accordingly, held in Circular dt. 16-1-1989 that the above products were to be classified as products of the packaging industry. The Apex Court held that, for the period prior to 16-1-89, the earlier circulars of the Board would govern classification of the goods. Following this decision of the apex court, we hold the view that, with regard to Note 5 to Chapter 30 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctual situation inasmuch as, in that case, Note 5 to Chapter 30 was held to be inapplicable for want of repacking from bulk pack to retail pack. We hold that the respondents' activity in question did not attract the first part of Note 5 to Chapter 38 inasmuch as the labelling/re-labelling of the barrels was done only to meet statutory requirements under the Standards of Weights and Measures Act and there was no repacking from bulk to retail pack. 7. In the second part of the Chapter Note, "adoption of any other treatment to render the product marketable to the consumer" is deemed to be 'manufacture'. Ld. Commissioner has eminently dealt with this aspect also. Re- branding of the imported goods was found to have been done as per specific ..... X X X X Extracts X X X X X X X X Extracts X X X X
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