1998 (1) TMI 269 - AT - Central Excise

Summary

Issues:
1. Whether the appellant is liable to pay duty as a manufacturer of V Beltings?
2. Interpretation of the inclusive definition of "manufacture" under Section 2(f) of the Central Excises Act, 1944.
3. Comparison with similar cases like Serampore Belting Works Ltd., Sidhosons, Hind Lamp Ltd., and Remington Rand of India.
4. Analysis of the agreement between the parties and determination of manufacturing responsibilities.
5. Application of legal principles from the Cibatul Limited case to the current scenario.
6. Assessment of the appellant's role in production and the risk-sharing arrangement with DIL.

Detailed Analysis:

1. The appeal challenges the Order-in-Appeal confirming the appellant as the manufacturer of V Beltings, directing duty payment based on retail prices to independent buyers. The lower authorities found the appellant engaged in manufacturing at DIL's premises, leading to duty liability.

2. The interpretation of the inclusive definition of "manufacture" under Section 2(f) of the Central Excises Act, 1944 was crucial. The agreement between the appellant and DIL, along with the production setup, indicated manufacturing activity by the appellant.

3. The comparison with cases like Serampore Belting Works Ltd., Sidhosons, Hind Lamp Ltd., and Remington Rand of India highlighted varying outcomes based on specific circumstances. These cases provided legal precedents for duty payment determination.

4. The analysis of the agreement revealed that DIL conducted manufacturing under the appellant's brand name, with pricing based on production costs and quality standards. The terms resembled those in the Cibatul Limited case, impacting the manufacturing attribution.

5. Legal principles from the Cibatul Limited case were applied to assess the appellant's manufacturing status. The distinction between manufacturing for oneself versus on behalf of a buyer, as clarified in the case, influenced the decision.

6. Considering the production arrangement and risk-sharing terms with DIL, it was concluded that the appellant did not engage in production on its own account. The appellant's role did not align with that of a manufacturer, leading to the appeal's success and the setting aside of the impugned orders.