1985 (10) TMI 172 - AT - Central Excise

Summary

Issues involved: Determination of whether the appellants can be considered manufacturers of waxed paper for excise duty purposes.

Summary:
The case involved M/s. Metal Box India Limited supplying base paper to M/s. Industrial Packaging for manufacturing waxed paper. The dispute arose when excise duty was not paid on the waxed paper supplied back to the appellants. The authorities contended that the appellants were manufacturers and liable for duty, citing the decision in the case of Shree Agency. The appellants argued that they were not manufacturers as they did not have the facility to manufacture waxed paper and relied on decisions from Andhra Pradesh High Court and Allahabad High Court.

The Tribunal analyzed the definition of 'manufacture' under the Central Excises and Salt Act, 1944, which includes a person who manufactures excisable goods on his own account. It was noted that the appellants did not fall under this definition as they did not manufacture the waxed paper themselves. The Tribunal also considered licensing requirements and rules indicating that the licensee is the manufacturer, not the raw material supplier.

The appellants contended that they were not the manufacturers as the actual manufacturing process was done by M/s. Industrial Packaging, who charged conversion charges. Relying on previous court decisions and a Tribunal case, the Tribunal set aside the lower authority's decision and allowed the appeal, stating that the appellants, who only supplied raw materials, should not be considered manufacturers for excise duty purposes.