NARNE TULAMAN MANUFACTURES PVT. LTD. HYDERABAD versus COLLECTOR OF CENTRAL EXCISE, HYDERABAD

Citation: [1988] SUPP. 3 S.C.R. 1 · Decided: 15-09-1988 · Supreme Court of India · Bench: SABYASACHI MUKHERJI · Disposal: Dismissed

cites 1 · see the full citation network in Lexace

Judgment (excerpt)

NARNE TULAMAN MANUFACTURES PVT. LTD. 
1,A 
HYDERABAD 
v. 
COLLECTOR OF CENTRAL EXCISE, HYDERABAD 
SEPTEMBER 15, 1988 
B 
[SABYASACHI MUKHARJI, M.H. KANIA 
AND S. RANGANATHAN, JJ.] 
.. 
Central Excises and Salt Act, 1944: Section 2(f)-'Manufacture' 
means bringing into existence new goods-When parts and end pro.duct 
separately dutiable-Both taxable. 
c 
The appellant manufactured one of the three parts, i.e., Indicat-
ing system, required for the manufacture of weighbridges, and after 
procuring the other two parts brought the three components together 
at site, fitted and assembled them together and thus created a new 
weighbridge. The appellant challenged the excise duty levied on the 
D 
manufacture of weighbridges under the Central Excises and Salt Act, 
.J 
1944 . 
The appellant's contention before the Customs, Excise and Gold 
(Control) Appellate Tribunal .was that it was preparing only.a part of 
the weighbridge which was dutiable as a separate part, and that as a 
E 
part of machine was liable to duty then the whole end product should 
not be dutiable as separate excise goods. The Tribunal held that by 
whatever process it became a complete weighbridge, as long as a 
weighbridge had been made and completed, duty had to be paid. 
According to the Tribunal, though the parts were themselves liable to 
~ 
excise duty, the complete machine was also a new excisable Commodity. 
F 
Dismissing the appeal, it was, 
HELD: (1) Section 2(1) of the Act provides an inclusive definition 
and states that the word "manufacture" includes any process inciden-
tal or ancillary to the completion of a manufactured product. So any 
G 
p~ 
by whkh an object becomes new commercial Commodity, including 
a11y process incidental or ancillary to the completion, would. be 
manufacture. [3C] 
J 
(2) Manufacture means bringing into existence new goods. There 
must be transformation and a new and differ~nt article must emerge H 
l 
2 
SUPREME COURT REPORTS 
[1Q88] Supp. 3 S.C.R. 
A 
having a distinctive name, character or use. [3D-E] 
Union of India v. Delhi Cloth Mills, [1%3] Suppl. 1 S.C.R. 5116; 
Allenburry Engineers (p) Ltd. v. Ramakrishna Dalmia, [1973] 2 S.C.R. 
257 and Idandas v. Anant Ramchandra Phadke, [1981] 3 Scale 1790, 
referred to. 
(3) If the end product is a separate product which comes into 
being as a result of the endeavour and activity of the appellant, then the 
appellant must be held to have manufactured the said item. When parts 
and the end product are separately dutiable-both are taxable. [4A-BI 
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 
C 1335-36 of 1987. 
' 
D 
From the Judgment and Order dated 3.10.1986 of the Customs 
Excise .and' Gold (Control) Appellate Tribunal New Delhi in Appeal 
No. E 1568 & 1569/81-Bl in Order No. 673/86-BI. 
A.S. Nambiar and B. Parthasarthi for the Appellant. 
Kuldip Singh, Additional Solicitor General, A.K. Srivastava 
and Mrs. Sushma Suri for the Respondents. 
E 
The Judgment of the Court was delivered by 
SAJIYASACHI MUKliARJI, J. These are appeals under section 
35L of the Central Excises and Salt Act, 1944 (hereinafter called 'the 
Act') arise from the decision of the Customs, Excise and Gold 
(Control) Appellate Tribunal {CEGAT for short), New D~lhi. The 
F question that fell for consideration by the Tribunal is whether the 
appellant M/s. Name Tulaman Manufacturers Pvt. Ltd. manufactured 
weighbridge~ and as such was liable to duty under the Act. 
It appears that weighbridges consisted of three different parts, 
namely, (1) Platform, (2) Load Cells and (3) Indicating system. The 
b contention of the appellant was that he got the platform manufactured 
from other people. The load cells were imported and the appellant 
only made the indicator system. In other words, it was the case of the 
appellant that it manufactured only the indicator system. The ques-
tion, that fell 'for the Tribunal's determination is whether the activity 
indisputably c.arried out by the appellant amounted to manufacture 
ff and what does it manufacture? It has been found that "the appellant 
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N.T. MFRS. v . .COLLECTOROFCENTRALEXCISE [MUKHARJl,J.) 
3 
brought the three components together at site, fitted and assembled 
them together so that they can work as one machine and as such the 
appellant manufactured and created a new weigbbridge". The afore-
said findings appear in paragraph 5 of the Tribunal's order. That 
weighbridge had not been excised before is not disputed. The term of 
the central

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