UNION OF INDIA AND ORS. versus J.G. GLASS INDUSTRIES LTD.

Citation: [1997] SUPP. 6 S.C.R. 345 · Decided: 09-12-1997 · Supreme Court of India · Bench: S.C. SEN · Disposal: Appeal(s) allowed

Judgment (excerpt)

. UNION OF INDIA AND ORS. 
A 
v. 
J.G. GLASS INDUSTRIES LTD. 
DECEMBER 9, 1997 
(S.C. SEN AND M. SRINIVASAN, JJ.) 
B 
Excise Law: 
Central Excises and Salt Act, 1944: Sections 2(f), 3 & 4 and Item 23-A. 
c 
Excise dztty-Manufacture-Pmticular proces:r-Amounting to-Deter-
mination of-Two-fold test-P1inting on glass bottle:r-Excise duty-Levy 
011:-Held : Firstly whether by that pmticular process a different commercial 
commodity comes into existence or whether identity of the 01iginal commodity 
ceases lo exist-Secondly, whether the original commodity would serve no 
pwpose but for that proces:r-Hence, plain glass bottles being themselves D 
commercial commodities, printing mz such bottles does not amount to 
manufacture within the meaning of S.2(f)-Therefore, not liable to excise duty 
if such printing is carried out i!l a different premises other than that in which 
plain bottles are manuf actured--Howeve1; if such p1inting is canied out in the 
same factmy whether the plain bottles are manufactured, the value of the E 
p1inted bottles including p1inting charges would be the assessable value of the 
excisable goods and duty is chargeable thereon. 
Words and Phrases : 
"Mamtfacture"-Meaning of-In the context of S.2(f) of the Central F 
Excises and Salt Act, 1944. 
The appellant-assessee was a manufacturer of glass and glassware 
falling under Tariff Item 23-A of the Central Excise Tarift'. Subsequently, 
the appellant commenced the process of printing of glass bottles with G 
ceramic colour in a separate demarcated unit. The Range Superintendent 
of Central Excise directed the appellant not to remove any printed bottles 
without payment of Central Excise duty on the enhanced value after 
including the expenditure incurred on printing/decorating. The Tribunal 
dismissed the appeal preferred by the appellants against the aforesaid 
order. Hence this appeal. 
H 
345 
346 
SUPREME COURT REPORTS (19971SUPP.6 S.C.R. 
· A 
On behalf of the appellant-assessee it was contended that printing 
B 
and decorating bottles woulcl not by any stretch of imagination amount to 
manufacture unless the process brings into existence a different commer-
cial product; and that the 11tain bottles did not cease to be bottles by some 
logos or names being printed thereon. 
Allowing the appeal, this Court 
HELD : I. There is a two-fold test which emerges for deciding 
whether the process is that of "manufacture". First, whether by the said 
process a different commercial commodity comes into existence or whether 
C 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 worcls, whether the commodity already in 
existence will be of no commercial use but for the said purpose. In the 
present case, the plain bottles are themselves commercial commodities and 
can be sold and used as such. By the process of printing name or logos on 
D the bottles, the basic character of commodity does not change. They 
continue to be bottles. It cannot be said that but for the process of printing, 
the bottles will serve no purpose or are of no commercial use. Therefore, 
printing on bottles will not amount to "manufacture" within the meaning 
of Central Excises and Salt Act, 1944.(355-D-F; 356-D-E; 357-C-D] 
E 
Union of India v. Delhi Cloth & General Mills, [1963) Supp. 1 SCR 
586; Deputy Commissioner of Sales Tax v. Pio Food Packen, [1980) Supp. 
SCC 174; Rollatainers Ltd. v. Union of India, (1994) 72 ELT 793 SC; CCE 
v. Paper & Products Co., (1996) 88 ELT 317 SC; Metagraphs Pvt. Ltd. v. 
CCE, [1997) 1 SCC 262; CCE v. Indian Coated Cmtons (P) Ltd., (1997) 92 
F 
ELT 459 SC and CCE v. Usha Mmtin Indust1ies, (1997) 94 ELT 460 SC, 
referred to. 
G 
Empire Indust1ies Ltd. v. Union of India, [1985) 3 SCC 314, held 
inapplicable. 
2. Admittedly, the bottles whether printed or not fall under Item 23-A 
(4) of the Central Excise Tariff. If the contention of the Revenue that 
printing of bottles would make them a different commodity, viz., printed 
bottles, is accepted it would lead to doubt taxation under the same tariff 
item. While at the gate of the main factory duty is leviable on the plain 
H bottles, under Item 23-A(4), once again duty will be leviable on the printed 
U.O.L v. J.G. GLASS INDUSTIUES LTD. [SRINIVASAN,J.] 
347 
bottles after the process of printing is over in the premises where such A 
printing is carried out. Such duty will undoubt

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