2004 (12) TMI 431 - AT - Central Excise

Summary

Issues:
- Whether benefit of Notification No. 53/88-C.E. (Serial No. 39) is available to M/s. S. Kumar Synfab Ltd.

Analysis:
The appeal filed by the Revenue questions the availability of the benefit of Notification No. 53/88-C.E. to M/s. S. Kumar Synfab Ltd. The Revenue argues that the dobby cards manufactured by the respondents do not meet the conditions specified in the notification, as they are made from plastic films/sheets not classifiable under Headings 39.01 to 39.15 of the Tariff. The Revenue relies on a previous Tribunal decision for verification of duty liability on the raw material used for manufacturing the dobby cards.

On the other hand, the respondents argue in their cross-objection that the process of punching dobby cards does not constitute manufacture under Section 2(f) of the Central Excise Act. They claim that the punched dobby cards are not sold in the market but are customized for individual manufacturers, making them non-marketable. The respondents assert that the benefit of the notification is applicable as the plastic dobby cards are made from polyester films falling under Headings 39.01 to 39.15. They also refer to a Board's Circular to support their claim.

The Tribunal considers both arguments and reviews the process undertaken by the respondents. The Commissioner (Appeals) had described the manufacturing process involving cutting, punching, and designing the dobby cards. Relying on previous tribunal decisions, the Tribunal concludes that punching the dobby cards results in a new product with distinctive characteristics, meeting the definition of manufacture as per the Supreme Court's test. The Tribunal rejects the argument that marketability determines manufacture, citing a previous tribunal decision that confirmed the marketability of punched dobby cards. Consequently, the Tribunal holds that the respondents' processes amount to manufacture, and the punched dobby cards are marketable.

Regarding the benefit of Notification No. 53/88-C.E., the Tribunal finds that the impugned goods made from plastic films/sheets do not qualify under the notification's conditions, as they are not produced from materials falling under Headings 39.01 to 39.15. The respondents' reliance on a Board's Circular is dismissed since they failed to prove the production of intermediate goods from duty-paid material falling under the specified headings. Therefore, the Tribunal allows the appeal filed by the Revenue, denying the benefit of the notification to the respondents.