2008 (1) TMI 786 - AT - Central Excise

Manufacture - re-glassline the old glasslined equipments - Held that - The Hon ble Mumbai High Court in case of Industrial Linings, Bombay and another v. UOI, 1988 (4) TMI 55 - HIGH COURT OF JUDICATURE AT BOMBAY has held that rubber lining of naked tanks and vessels or of old tanks or vessels received from user-consumers or customers does not amount to manufacture in terms of Section 2(f) of Central Excise Act - we hold that re-lining old and used cylinders does not amount to manufacture - appeal allowed - decided in favor of appellant.

Summary

Issues: Whether re-glasslining of old vessels amounts to manufacture under Central Excise Rules, 1944.

The judgment by the Appellate Tribunal CESTAT, Ahmedabad, involved the issue of whether the process of re-glasslining old vessels constitutes manufacture. The appellants, engaged in manufacturing glasslined vessels, also re-glasslined old equipment under Rule 173H of Central Excise Rules, 1944. The dispute arose when authorities contended that duty should be paid on the entire value of re-glasslined vessels, which the appellant challenged, arguing that re-glasslining did not amount to manufacture. The Tribunal noted that the issue had been settled by previous decisions. Citing cases like Industrial Linings and Reliance Storage Energy & Systems, it was established that activities such as repairing, re-making, and re-conditioning of old goods do not constitute manufacture. The Tribunal also referred to cases where re-rubberizing of old rollers and re-engraving of cylinders were deemed non-manufacturing activities. Based on these precedents, the Tribunal held that re-lining old cylinders does not amount to manufacture. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant, granting them consequential relief.