2005 (12) TMI 583 - AT - Central Excise

Summary

Issues:
1. Whether cutting and slitting of jumbo rolls of polyester into smaller width in the shape of strips amounts to manufacture.

Analysis:
The issue in the present appeal was whether the cutting and slitting of jumbo rolls of polyester into smaller strips constitute a manufacturing activity. The Commissioner (Appeals) ruled in favor of the assessee, citing previous judgments and legal precedents. The Commissioner noted that the process of slitting and, in some cases, printing on duty paid plastic films in jumbo rolls was done solely to reduce the width of the film for use in audio cassettes. The Commissioner emphasized that these activities did not result in the emergence of an excisable commodity. Reference was made to the judgment of the Hon. Madras High Court in a previous case, which held that cutting jumbo rolls into smaller sizes did not amount to manufacturing. Additionally, the Commissioner highlighted a CEGAT judgment that supported the position that bringing duty paid plastic films did not constitute manufacturing.

The Appellate Tribunal, after hearing the arguments, considered the decision of the Hon'ble Supreme Court in a recent case involving the cutting and slitting of jumbo rolls of plain tissue paper/aluminium foil. The Supreme Court had held that such activities did not amount to manufacturing as they did not change the character or end-use of the products. Applying the ratio of this Supreme Court decision, the Appellate Tribunal concluded that no manufacturing activity was involved in the case at hand. Therefore, the appeal filed by the Revenue was rejected based on the legal precedents and the principles established by the Supreme Court.

In summary, the judgment revolved around the interpretation of whether cutting and slitting activities on jumbo rolls of polyester constituted manufacturing. The decision considered previous legal precedents, including judgments from the Hon. Madras High Court and the CEGAT, to determine that such activities did not amount to manufacturing. The Appellate Tribunal further relied on a recent Supreme Court decision regarding similar activities on different materials to support the conclusion that no manufacturing activity was involved in the case.