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TMI Blog1967 (4) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... h silver thread to the extent of ₹ 6,556 (2) The licensee shall export within 6 months of the import of the material covered by this license ₹ 6556/- worth of finished goods as mentioned in 1 above (3) The licensee shall export the same imported material duly embroidered in India with silver thread and the entire yardage 1296 yards imported against this license should be exported". (2) The petitioner re-exported the goods after they had been made into table covers and embroidered in India and by the shipping bill claimed drawback of duty under Section 43B of the Sea Customs Act, 1878. The petitioner claims that the Customs authorities kept two samples of the silk imported and also of the table covers made of that silk at the time of its export and were satisfied that the petitioner had re-exported the entire imported silk represented by the finished goods and, Therefore, allowed the export. The petitioner had also been required to execute a bond in favor of the Government of the value of 100 per cent the imported cost duly guaranteed by a schedule bank guarantee the re-export of the finished goods including the entire imported material within six months of the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such customs-port to any foreign port, or as provisions or stores for use on board a ship proceeding to a foreign port seven-eighth or in the case of silver bullion the whole of such duties shall, except as otherwise hereinafter provided he replied as drawback: ...................................................................." One of the conditions prescribed in the proviso to Section 42 is that:- "in every such case the goods be identified to the satisfaction of the Customs Collector at such customs-port ................." Sec 43B dealt with the drawback on goods taken into use between importation and re-exportation and sub-section (1) of Section 43B under which claim was made. Provides- "(1) Where it appears to the Central Government that, in the case of goods of any class or description manufactured in, and exported from India or shipped as provisions or stores for use on board as ship proceeding to a foreign port, a drawback should be allowed of duties of custom chargeable under this Act in respect of any material of a class or description used in the manufacture of such goods, the Central Government may, by notification in the Official Gazette direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only to such class of goods as are capable of being easily identified. The true construction of Section 42 appears to be that- (1) the concession extends only to such goods which are capable of being identified; and (2) with respect to such goods a party is entitled to drawback if those very goods are re-exported. Section 49, which confers powers on the Central Government to "declare what goods shall, for the purpose of this chapter, be deemed to be capable of being easily identified", lends further support to the view that I am taking. Section 43B, on the other hand, appears to apply to materials of any class or description which are imported and used in the manufacture of such goods as are re-exported. The question that calls for decision, Therefore, is: was the silk imported re-exported as such or was it only a material used in the manufacture of the goods exported? In the shipping bill the goods exported are described as "silk table covers embroidered with silver thread" Mr. Chadha said that Section 43B applied only where the materials are subjected to such process of manufacture as results in loss of identify of the materials. There appears to be no forc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 284, 3 L. Ed 102; nor marble cut into blocks for transportation." The Law Lexicon of British India by P/ Ramanatha Iyer, page 785, also gives various meanings of the word "manufacture" but the most relevant are the following:-- "To constitute a manufacture, within the customs duty acts, there must be a transformation. Mere labour bestowed on an article, even of the labour is applied through machinery, will not make it a manufacture, unless it has progressed so far that a transformation ensues, and the article becomes commercially known as another and different article from that as which it began its existence. Every alternation in an article does not confer on it a new character as a manufacture. To constitute a new and different article and a manufactured article, it must be so changed as to have a positive and specific use in its new state." No doubt, the definition of the term "manufacture" as given by the lexicographers does not necessarily afford a true test in laws as to what should or should not ,while dealing with a given statute, be construed as amounting to manufacture but that definition does provide a guide as to what meaning, in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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