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TMI Blog1986 (2) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... es Industries, Udhna. The petitioners received notice dated, 26/27-3-1971 from the Superintendent, Central Excise, Range 'C' Surat, purported to have been issued under Rule 9(2) of the Rules, to show cause as to why the duty as specified therein should not be recovered from them, and also to produce all evidence on which they intend to rely in support of their defence, against the proposed action to be taken for payment of duty on the twisted wires for the period from 3-11-1967 to 31-12-1970, which was estimated in the said notice at Rs. 6,323.22 paise. This notice is at Annexure 'D'. The petitioners also received similar show cause notice, dated 21-12-1971 under Rule 9(2) of the Rules for the payment of duty of Rs. 2,575.56 paise for the period from 1-4-1962 to 2-11-1967 (Annex. 'B'). 3. The petitioners vide their reply, dated 29-5-1972 (Annexure 'C') stated that the petitioners were doing only the job work of twisting wires of Ms. Bharat Wires Industries since 1962, but the records in regard to the same were not available. It was further stated therein that the petitioners were receiving untwisted bare copper wire from M/s. Bharat Wire Industries, Udhna which were returned to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government of India, Ministry of Finance, Department of Revenue and Insurance, New Delhi. The Joint Secretary by his order, dated 2-3-1976 (Annexure 'I') held that the decision of the Appellate Collector regarding limitation was incorrect, and that the provisions of the Limitation Act cannot be applied by the officers functioning under the Act. It was further held that "the Copper Wires in uninsulated condition as cleared by the petitioners were correctly classifiable under Tariff Item 33-B(ii) and accordingly were chargeable to duty which was payable at the time of their removal from the place of manufacture" and, therefore, the petitioners were required to pay excise duty under both the notices. 7. Being aggrieved by the aforesaid decision of the Government of India, the petitioners have filed this petition. 8. Mr. J.U. Mehta, learned Advocate for the petitioners, has raised several contentions regarding the levy of excise duty after a lapse of nine years. However, it is not necessary to reproduce all the contentions of Mr. Mehta, since this petition can be decided on narrow issue as to whether the job work of twisting wires done by the petitioners after bringing them from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... :- "Item No. Description of Goods Rate of Duty 33B. other wise Electric Wires and Cables All sorts, not specified aluminium or other (i) Insulated wires and cables of copper, metals and alloys, whether sheathed or one specially ductor of any core of which, not being unsheathed, the con a sectional area not exceeding 1.5 square designed as a pilot core, has exceeding 2.5 square millimetres in millimetres in the case of copper, or not equivalent conductivity as of copper case of aluminium or of not more than the the case of other metals and alloys. in Seventeen and half per cent ad valorem (ii) All others Explanation :- The item shall not wires and cables, all sorts' used in this expression 'electric include square or rectangular conductors, whether insulated or not." lorem. Ten per cent ad va Section 3(1) of the Act, which is a charging section gives power to levy and collect duty of excise on all excisable goods other than salt which are produced or manufactured in I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales Tax Law is 'sale'. The taxable event under the Excise Law is manufacture. The moment there is transformation into a new commodity commercially known as a distinct and separate commodity having its own character, use and name, whether be it the result of one process or several processes 'manufacture' take place and liability to duty is attracted." The Supreme Court has referred to the decision in Chowgule Co. Pvt. Ltd. v. Union of India, (1981) 1 Supreme Court Cases 653, and observed as under : "Whatever may be the operation, it is the effect of the operation on the commodity that is material for the purpose of determining whether the operation constitutes such a process which will be part of 'manufacture'. Any process or processes creating something else having a distinctive name, character and use would be manufacture." In the instant case, the Excise Department is not able to show that the twisting of a copper wire creates a new commodity having a distinctive name, character and use. A copper wire is a conductor. Similarly, twisted copper wire is also a conductor. By twisting wires it cannot be said that a new commodity has been created having a distinctive name, cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facturing insulated copper wires. Therefore, twisting of such wires can, by no stretch of imagination be said to be a manufactured goods within the meaning of the definition of 'manufacture' given in Sec. 2(f) of the Act, and was not liable to any Excise Duty. In our opinion, argument of Mr. Mehta shall have to be accepted because the Department is not in a position to show that by the aforesaid process any new commodity commercially known as a distinct and separate commodity having its own character, use and name had come into existence. In our opinion it is one of the process for manufacture of insulated copper wires which are ultimately manufactured by M/s. Bharat Wire Industries, and we are told, who had paid the duties under Tariff Item No. 33-B(i) of the First Schedule to the Act. The petition, therefore, succeeds. 13. In the result, therefore, the petition is allowed. The impugned order, dated 2-3-1976 (Annexure 'I' to the petition) and the orders of the subordinate authorities assessing excise duty against the petitioners are hereby quashed and set aside. Duty, if any, paid by the petitioners, be refunded to them within four weeks of the receipt of the writ of this Court. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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