Guniting of duty paid pipes - Whether amounts to manufacture - Central Excise - 17/88

Guniting of duty paid pipes - Whether amounts to manufacture Circular No. 17/88 Dated 1-6-88 [From F. No. 139/94/87-CX.1V] Subject : Guniting of duty paid pipes - Whether amounts to manufacture. A question had arisen whether the process of Guniting i.e. cement mortar coating on the outside and epoxy/bitumen painting inside duty paid steel pipe carried out at site on construction of water supply pipe line, would amount to manufacture or not. The matter has been examined by the Board. It is observed that there is nothing in Central Excise Tariff Act, 1985 and Sections and Chapter notes specifically covering the process of coating, but coated pipes are classified along with uncoated pipes in HSN. HSN Explanatory notes for heading 73.04 and 73.05 specifically provide that the product of the heading may be coated. For example, with plastics or glass wool combined with bitumen, in a similar matter regarding coating of steel pipes involved in laying of gas pipelines, Board in letter F. No. 139/68/86-CX.4, dated 22-12-1986 have already clarified that coating of duty paid steel pipes would not amount to manufacture under the Central Excise law. In view of the above, the Board has decided that the process of cement mortar coating on the outside and epoxy bitumen painting inside of steel pipes known as 'Guniting' carried out during the construction of water supply pipeline does not amount to manufacture