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TMI Blog1986 (8) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellate Collector of Central Excise, Bombay under Order dated 27-10-1980. Thereunder he held that while use of power in the manufacture of hoses would not, for that reason, deny entitlement to exemption under notification No. 179/77, since such hoses are only raw materials for the manufacture of gas mantles, the use of power in ironing is sufficient to deny the availability of the exemption. On the question of use of power for drying he noted that the appellants stated before him that they had now discontinued use of power for the said purpose and held that it is only from the date of discontinuance of the use of power for drying that benefit of exemption would be available to the appellants even if the finding on the other question as to the use of power in ironing was to be in their favour. As already stated, he held that use of power in ironing the gas mantles was use of power in a process incidental or ancillary to the completion of manufacture of gas mantles and hence the appellants were not entitled to exemption applied for. On this finding he had rejected the appeal. The appellants preferred a revision petition to the Government against the said order. The same is now ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the butter paper envelope was in order to enable packing 25 of such envelopes in a larger carton. Dr. Jois contended that the need for ironing being for the above said purpose only the ironing was subsequent to the complete manufacture of the gas mantle and hence the use of power at that stage would not be use of power either in or in relation to the manufacture of the gas mantles. On the other hand the contention for the Department (as also the finding of the Collector) is that this process of ironing was a process incidental or ancillary to the completion of the manufacture of the gas mantle, and that therefore use of such power disentitled the appellants to benefit under notification No. 179/77. The main submissions, therefore, before us was with reference to the question whether the ironing of the gas mantle was a process incidental or ancillary to the completion of the manufacture of the gas mantle. Dr. Jois contended that the manufacture of the gas mantle was complete at the seventh stage of the nine stages mentioned in the Collector s order and hence the eighth and ninth stages were not stages in, or even in relation to, manufacture. According to him the ironing was neces ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se relating to manufacture and clearance of vegetable products. It was held by the High Court that there was no warrant for the construction that the manufacture of the vegetable product is not complete until it is packed in a tin container. It was pointed out that such hydrogenated vegetable oils are also sold and transported in bulk containers, in tankers and it may indeed be sold to the wholesale buyer who brings his own container for receiving the product. 9. To similar effect was the finding of the Madhya Pradesh High Court in the case of Malwa Vanaspati and Chemical Co. Ltd. v. Union of India (1979 E.L.T. 243). Referring to the definition of the term manufacture in Section 2(f) of the Central Excises and Salt Act the Court observed that where the legislature intended to include in the term Manufacture any process to make the commodity marketable to the consumer, it has been specifically provided for. The court therefore further held that packing the vegetable product in a container could not be said to be a process incidental or ancillary to the completion of the manufacture. 10. In the case of Orissa Industries Ltd. v. Union of India (1979 E.L.T. 457) the Calcutta High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase manufactured by itself and then sold the product under the trade name of Bush Auto-changer . The Court observed the can be no manner of doubt that with or without the wooden base or with or without the cover, the imported Garrard record-changer decks remained the same commodity and that there was no change whatsoever in the end product merely because it was placed on a wooden base with or without a cover. That it was so done could be for many reasons viz. to make it more saleable by presenting it in a more appealable way or by making it more convenient to carry, or for several other reasons none of which change the slightest the nature or character of the product imported by the petitioner, viz. Garrard record-changers . Dr. Jois contended that similarly in the present instance also the process of ironing the gas mantle and placing the same in a butter paper envelope was merely for making the already manufactured product more convenient to carry and to make it more saleable by presenting it in a more appealable way and hence the said process of ironing was not part of the process of manufacture. 14. Another decision which would also be relevant is Assistant Collector of Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acking will also include in the value. But inclusion of the packing charges in terms of provision of Section 4 would not necessarily make the process of packing part of the process of manufacture as defined in Section 2(f). 17. Shri Kunte further refers to the decision of this Tribunal in Hindustan Lever Ltd. v. Collector of Central Excise, Bombay (1985 Vol. 19 E.L.T. 96). Several of the decisions cited earlier had been considered in the said decision and it was held that normal minimum packing (not in a special packing or durable/returnable containers) without which the manufactured product could not be delivered, whether for reasons of transport or otherwise, should be treated as a process incidental or ancillary to the completion of that products. 18. The Appellate Collector has in his order relied on one judgment only to arrive at his conclusion that the process of ironing in the present case was a process incidental and ancillary to the completion of the manufactured product (Gas mantles). The said decision is that of the Kerala High Court in Metro Readywear Company v. Collector of Customs (1978 E.L.T. 520). The assessee in that case was manufacturing Brassieres. After sti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... antle. The process of ironing is carried out only for the purpose of ease of convenient packing for the purpose of transport and delivery. The mantles could be sold even without such packing, the effect of non-ironing only making the packing a little more bulky and space consuming. We have seen that several of the High Courts have held that even when a particular form of packing is made obligatory in law before the manufactured product could be sold to the consumer, such packing would not be a process incidental or ancillary to the completion of the manufacture of the product. In the present instance packing in a butter paper envelope is neither obligatory nor even necessary but is only carried out for the purpose of convenient dispatch and delivery. In such circumstances we are of the view, following the dicta in the several decisions cited supra, that the process of ironing carried out by the appellants, though with the aid of power, did not, for that reason, disentitle them from the benefit of notification 179/77-CE, dated 18.6.1977. 20. Hence, we set aside the order of the Appellate Collector to the above extent but maintain his order in so far as it denied benefit under the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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