LexCOMMISSIONER OF CENTRAL EXCISE BELAPUR versus JINDAL DRUGS LTD.
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* Author [2024] 5 S.C.R. 271 : 2024 INSC 354 Commissioner of Central Excise Belapur v. Jindal Drugs Ltd. (Civil Appeal No. 1121 of 2016) 30 April 2024 [Abhay S. Oka and Ujjal Bhuyan,* JJ.] Issue for Consideration The issue for consideration is whether an activity of re-labelling of goods i.e. cocoa butter and cocoa powder, by affixing additional labels on both the sides of the packs containing goods, amounts to “manufacture” in terms of Note 3 to Chapter 18 of the Central Excise Tariff Act, 1985, for availing the CENVAT Credit and rebate on the duty paid while exporting the said goods. Headnotes Central Excise Tariff Act, 1985 – Note 3 to Chapter 18 – Cocoa and Cocoa preparations – Whether re-labelling amounts to ‘manufacture’ as per Section 2(f) of the Act – Explained: Held: Note 3 to Chapter 18 of the Central Excise Tariff Act, 1985 (post amendment), which deals with Cocoa and Cocoa Preparations contemplates that if any of the three processes are satisfied, then the activity shall amount to ‘manufacture’, viz., (i) labelling or re- labelling of containers; or (ii) repacking from bulk packs to retail packs; or (iii) the adoption of any other treatment to render the product marketable to the consumer – In the present case, while upholding the decision of the Customs, Excise and Service Tax Appellate Tribunal, it was held that the activity carried out by the Respondent of relabelling on both sides of the packs containing the goods and thereafter, introducing in the market or sending it for export, amounts to ‘manufacture’ in terms of Note 3 to Chapter 18 of the Central Excise Tariff Act, 1985. [Para 13.3, 15] Central Excise Tariff Act, 1985 – Amendment to Note 3 to Chapter 18 of the Central Excise Tariff Act, 1985 – Replacing the words ‘or’ by ‘and’ – Interpretation of: Held: By way of the amendment in 2008, the word ‘and’ was replaced by the word ‘or’ between the expressions ‘labelling or re-labelling of containers’ and ‘repacking from bulk packs to retail packs’ – Prior to 01.03.2008, the legislative intent was quite clear – The process to 272 [2024] 5 S.C.R. Digital Supreme Court Reports constitute manufacture should either be labelling or re-labelling of containers and repacking from bulk packs to retail packs – This process was construed to be one whole – In other words, the activity should not only include labelling or re-labelling of containers but the same should relate to repacking from bulk packs to retail packs – This was one activity – However, after the amendment i.e. post 01.03.2008, Note 3 has undergone a change – Now because of substitution of the word ‘or’ in place of the word ‘and’ between the two expressions ‘labelling or re-labelling of containers’ and ‘repacking from bulk packs to retail packs’, the earlier composite process of labelling or re-labelling of containers and repacking from bulk packs to retail packs has been split up into two independent processes – Labelling or re-labelling of containers is one process and repacking from bulk packs to retail packs has now become another process – Therefore, instead of two activities, Note 3 now contemplates three activities – The composite activity of labelling or re-labelling of containers and repacking from bulk packs to retail packs has been split up into two activities i.e. labelling or re-labelling of containers is one and the other is repacking from bulk packs to retail packs. [Paras 13.2, 13.3] List of Acts Central Excise Tariff Act, 1985. List of Keywords Manufacturing Activity; Re-labelling, CENVAT Credit, Rebate, Indirect Tax. Case Arising From CIVIL APPELLATE JURISDICTION: Civil Appeal No.1121 of 2016 From the Judgment and Order dated 16.04.2015 of the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench at Mumbai in Appeal No. E/86389/13-MUM With Civil Appeal Nos. 788-790 of 2022 Appearances for Parties Rupesh Kumar, Sr. Adv., Mukesh Kumar Maroria, Keval Babubhai Rathod, Shamik Sanjanwala, Shyam Gopal, Sughosh Subramanyam, Rohit Verma, B. Krishna Prasad, Advs. for the Appellant. [2024] 5 S.C.R. 273 Commissioner of Central Excise Belapur v. Jindal Drugs Ltd. V. Sridharan, Sr. Adv., Prakash Shah, Jas Sanghavi, Jasdeep Singh Dhillon, Prabhat Kumar Chaurasia, Yuganthar Singh Chauhan, Rahul Gupta, Prabhat Chaurasia, Yugantar Singh Chauhan, Anirudh Jamwal, Advs. for the Respondent. Judgment / Order of the Supreme Court Judgement Ujjal Bhuyan, J. Heard learned counsel for t
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