2000 (9) TMI 388

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..... t they also undertake repairs of old transformers; that as the repair undertaken by them resulted in the conversion of Model BOT 3460 to Model HETT 3900, the Assistant Commissioner under Adjudication Order Nos. 152-153/97, dt. 16-4-1997, demanded the duty and imposed penalty holding that process amounted to manufacture as BOT 3460 is a low capacity transformer compared to HETT 3900 transformer and the cost of repair/rewinding would be more than repair and reconditioning only; that the Commissioner (Appeals), under the impugned Orders, has set aside the Adjudication Order, holding that upgradation of a machine would not amount to manufacture so long as the said upgradation does not bring into existence goods with a new name, character and us .....

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..... n the decision in Shriram Refrigeration Industries Ltd. v. CCE, Hydrabad, 1986 (26) E.L.T. 353 (T) wherein it was held that no manufacture was involved when the Original defective parts were replaced by new parts and identity of the product was not lost. He also relied upon the decision in the case of Enfield India Ltd. v. CCE, Madras, 1996 (88) E.L.T. 773 (T), in which Tribunal held that 'The change or upgradation of the machine or change of some parts cannot be taken to be manufacture of a new product for excise purposes. He also relied upon the decision of the Apex Court in U.O.I. v. J.G. Glass Industries Ltd. - 1998 (97) E.L.T. 5 (S.C.) and State of Tamil Nadu v. Pyare Lal Malhotra, 1983 (13) E.L.T. 1982 (S.C.) wherein it was held "befo .....

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..... or deciding whether the process is that of 'manufacture'. "First, whether by the said process a different commercial commodity comes into an existence or whether the identity of the original commodity ceases to exist; secondly, whether the commodity which was already in existence will serve no purpose but for the said process. In other words, whether the commodity already in existence will be of no commercial use but for the said process. Applying these tests to the matter in hand, the only conclusion which one can reach is that the process undertaken by the Respondents does not amount to manufacture in as much as a new and different article having a distinctive name, character or use does not emerge. Transformer remains transformer and it .....

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