2010 (7) TMI 410 - AT - Central Excise

Waiver of pre-deposit manufacture - activity of packing or repacking as well as labeling or re-labeling of containers would amount to manufacturing process - Branch Manager stated that they carry out the tinting process at their depot to obtain required shade of the paint as and when required - process of tinting, paints was being carried out as per the requirement of the customers and essentially for the marketability of the product to the customer Held that - appellants representative himself had clearly admitted this fact no case for waiver of pre-deposit

Summary

Issues:
- Appeal against order of Commissioner (Appeals) Delhi
- Demand of Rs. 48,378/- along with interest and penalty
- Waiver of deposit during appeal
- Tinting process undertaken at depot
- Interpretation of the term "manufacture" under Central Excise Act, 1944
- Marketability aspect of tinting process
- Barred demand by law of limitation
- Submission of invoices with required declaration
- Definition of 'manufacture' under Central Excise Act, 1944
- Waiver of penalty amount

Analysis:
The case involved an appeal arising from the order of the Commissioner (Appeals) Delhi confirming a demand of Rs. 48,378/- along with interest and penalty against the appellants. The appellants sought a waiver of the deposit requirement during the pendency of the appeal. The dispute centered around the tinting process carried out at the appellants' depot to obtain the required shade of paint. The Department contended that the process rendered the product marketable, while the appellants argued that tinting alone did not amount to manufacture unless it made the product marketable to consumers.

The definition of 'manufacture' under the Central Excise Act, 1944 was crucial in determining whether the tinting process qualified as manufacturing. The clause specified various activities, including labeling and any treatment to render the product marketable. The Tribunal observed that any treatment intended to make the product more marketable to consumers would constitute manufacture. The Branch Manager's statement confirmed that the tinting process aimed at making the product ready for marketing, supporting the Department's position.

The appellants relied on previous decisions and argued that the tinting process did not meet the marketability criteria. However, the Tribunal found their argument unconvincing based on the Branch Manager's statement. The Tribunal emphasized that the tinting process was undertaken to meet customer requirements and enhance marketability, aligning with the definition of 'manufacture.'

Regarding the demand being barred by limitation, the Tribunal noted that the appellants had not raised this point earlier, precluding its consideration at that stage. Ultimately, the Tribunal partially allowed the application, waiving the penalty amount but requiring the deposit of the duty demanded along with interest within a specified period. The decision highlighted the importance of the marketability aspect in determining whether a process constitutes manufacturing under the Central Excise Act, 1944.