1987 (1) TMI 312 - AT - Central Excise

Summary

Issues involved: Determination of whether cutting marble blocks into slabs constitutes "manufacture" under Sec. 2(f) of the Central Excises and Salt Act, 1944 and the liability of excise duty on the produced slabs under Tariff Item No. 68 of the Central Excise Tariff Schedule.

In the case, the appellants were engaged in cutting rough marble blocks into slabs on a job-work basis, with marble blocks supplied by outsiders. The Central Excise authorities contended that this process amounted to "manufacture" under Sec. 2(f) of the Act and that duty was chargeable on the slabs under Tariff Item No. 68. The appellants paid duty until 31-3-1981 based on the job charges but claimed exemption from 1-4-1981 onwards under Notification No. 105/80. However, the Assistant Collector disallowed the exemption and held duty was payable from 1-4-1981 on the full value of the goods, a decision upheld by the Collector (Appeals).

An earlier case before the Tribunal, M/s. Fine Marbles & Minerals Pvt. Ltd., Makrana, had ruled that cutting marble blocks into slabs did not constitute "manufacture" under the Act, and the produced slabs were not liable for excise duty under the Tariff Schedule. This decision was challenged by the Revenue in the Supreme Court, which ultimately dismissed the appeal. Consequently, the present appeal in question succeeded, and the appellants were granted relief.