1988 (9) TMI 139 - AT - Central Excise

Summary

Issues:
- Whether crushing of dolomite mined into lump form into powder and chips amounts to a process of manufacture.

Analysis:
The central issue in this case revolves around determining whether the process of crushing dolomite lumps into powder and chips constitutes a process of manufacture. The appellant, represented by the learned SDR, argues that the transformation of dolomite lumps into powder and chips results in a new product with distinct characteristics, thus qualifying as a process of manufacture. The appellant relies on various judicial precedents, including the Supreme Court's decision in Delhi Cloth and General Mills, to support the contention that any change resulting in a new and distinct article amounts to manufacture. Additionally, the appellant cites specific cases such as Collector of Central Excise, Jaipur v. Oriental Products Pvt. Ltd. and Brakes India Ltd. v. Superintendent of Central Excise to strengthen the argument that the process in question falls under the ambit of manufacture.

On the contrary, the respondent's consultant argues that the process of crushing and grinding dolomite does not amount to manufacture as the end product remains dolomite in different forms. The respondent relies on the Supreme Court's judgment in MMTC v. Union of India, emphasizing that the marketability of the product as dolomite chips and powder does not alter its fundamental nature as dolomite. Furthermore, the respondent cites precedents such as Collector of Central Excise, Patna v. M/s. Pyrites, Phosphates and Chemicals Ltd. and Collector of Central Excise, Jaipur v. Fine Marbles and Minerals Pvt. Ltd., Makrana to support the assertion that similar processes were not considered manufacture under the law.

The Tribunal, after careful consideration of both arguments, concludes that the determination of whether a process constitutes manufacture is case-specific and depends on whether a new commodity with distinct characteristics emerges. While acknowledging the differing interpretations of the term 'manufacture,' the Tribunal places significant weight on the judgment of the Madhya Pradesh High Court in Behraghat Mineral Industries, which directly addresses the issue at hand. The Tribunal concurs with the Madhya Pradesh High Court's ruling that the process of crushing and grinding dolomite lumps into powder and chips does not result in the creation of a new commercial commodity. Therefore, the Tribunal rejects the appeals and upholds the original order, ruling that the process in question does not amount to manufacture.