Dempo Engg. Services Vs. Collector of C. Ex. and Customs - Court Judgment

Excerpt:
1. the appellants are civil engineers and contractors. they are aggrieved by the order no. 25/ collr. goa/cex/94, dated 26-12-1994 whereunder they were asked to pay a duty of rs. 9,79,498/- payable on the steel structurals classified also under proviso to sub-section (1) of section 11a of the central excise act, 1944. by the said order the collector also imposed penalty of rs. 50,000/- for contravention of rules 173q and 9(2) of the central excise rules.2. the appellants are civil engineers and contractors. they undertook what are known as civil contracts and also entered into sub-contracts for construction at factory site relating to structural fabrications.the sub-contractors in this case were indian commerce and industries co. ltd. (known as ici) who were independent fabricators. the appellants entered into contract for building factory and structural fabrications. the dealings between the appellants and its employers goa shipyard ltd. was on principal to principal basis and equally the dealings between the appellants and sub-contractors ici were on principal to principal basis. raw material was supplied by the goa shipyard ltd. out of the price paid by goa shipyard ltd. the appellants retained the middleman trader's profit and pass on the remaining job work charges to the actual fabricator viz. ici. as stated earlier the fabricator is ici ltd., madras, which was an independent person and not a dummy of the appellants. a scn was issued on 6-2-1991, (page 2 of the paper book) alleging that the appellants had fabricated steel structures and roofing systems weighing 482.376 mts valued at rs. 62,19,039.75 during construction of bay i of m/s goa shipyard ltd. and appellants failed to pay an amount of rs. 9,79,498.75 by way of duties of central excise. the scn also charged the appellants gsl vaso of contravening provisions of various rules like 9, 49, 53,173b, 173c, 173g, etc. and have rendered themselves liable to penalty under the various provisions of the central excise rules. the appellants by their letter dated 5th march, 1991 denied its liability. it stated inter alia that they did not undertake the job of fabrication of steel structures.in the scn there is a reference to a statement made by one shivdas which also states that the appellants submitted the final bills and copies of contracts which were returned to the representative of the appellant after scrutiny. the show cause notice further stated that no appellants submitted copies of running account bills and pre final bill of m/s indian commerce and industries co. p. ltd. sub-contractors. the statement of shri shivdas, finance manager was cited as evidence in respect of the scn. the period in dispute was from 26-2-1986 to 1-4-1998. the scn states inter alia that gsl entered into civil contract with the appellant and gsl supplied the raw materials and got the structurals fabricated from the sub-contractors on the appellants' account. therefore scn charged appellants were liable to pay the duty.the appellants filed a reply on 5-3-1991 denying its liability. it stated inter alia in paragraph 2 of its reply that the fabrication was not done by the appellants and whenever it is required they got these items fabricated by other steel fabricators like indian commerce industries, madras and appellants retained only the middleman trader's profit of 5%. it has been specifically stated in paragraph 2 of the said letter that the madras firm have carried out the fabrication at the site by engaging their own labourer, on which the appellants did not have any supervision or control. the madras firm, the job worker it was submitted were independent builders and fabricators having their own rights. in the written submissions filed before the collector it was submitted that the supervision by the appellants have been confined only to quality control. the basic raw materials was supplied by gsl and the construction was carried out at the site. without prejudice to what is stated there, the appellants also submitted that fabrication like channels, angles, girders etc. no new product emerged thereby the identity of the individual constituents was never lost. they raised the query that no manufacture within the meaning of section 2(f) of the central excise act had occurred. they cited various judgments including that of the supreme court in ujjagar prints ltd. case. the adjudicating authority on the basis of the materials before him rejected the contentions of the appellants and confirmed the duty demand under the show cause notice and also imposed penalty. hence the present appeal.3. shri m.k. maingi, ld. counsel appeared for the assessee and shri k.m. patwari, ld. jdr appeared for the department.4. it is contended by mr. maingi, learned counsel that processes of drilling, welding and fasting does not amount to manufacture and these goods do not become goods within the meaning of section 2(d) of the central excise act. he cites among other things the judgment of the tata engineering & locomotives v. cce, 89 e.l.t. 463. he also states that fabrication and erection of structural steel shed on site is not manufacture and relies on the judgment of the tribunal in the case of pratap steel rolling mills v. cce -1990 (48) e.l.t. 539. he also invited our attention to the judgment of the karnataka high court in thungabhadra steel products ltd. v. uoi -1998 (98) e.l.t. 334 for the proposition that assembling of fabricated structure at customer's site would not amount to manufacture. he also cited several other decisions in support of his preposition of law. he stated that under the contract it is the sub-contractors, ici ltd., madras who are the manufacturers being a job worker. in terms of judgment in supreme court in ujjagar prints case it is the sub-contractors, ici ltd., madras could be the manufacturer no the appellants.5. in reply, ld. dr while reiterating the impugned order invited our attention of the judgment of supreme court in sirpnr paper mills ltd. v. cce, hyderabad -1998 (97) e.l.t. 3 that just because the plant and machinery affixed on earth for better functioning it did not automatically become an immovable property.6. we have considered the rival submissions. in the scn, there is a reference to the statement made by mr. shivdas, finance manager, of the appellants. points arising under the statement of shri shivdas is reflected as under: 2. the cost of raw material was recovered by the clients or pre-fixed rates from the cost of total'contract. 3. although des had taken contracts from the clients for civil contracts, the works of structural fabrication was sub-contracted. 5. the sub-contractors did the work as per specifications and drawing of the clients and under general supervision of des. 6. the sub-contractors were paid for the fabrication by des as it was part of the general civil contract between des and the clients. 8. the gsl vasco contract was substantially completed around december,1989 and it took them about 20 months from commencement. 9. the fabrication was done at clients site. however small parts might have been fabricated outside by the sub-contractors. 10. the deduction of the client on account of raw material supplied is rs. 37,48,915.50. 11. he also submitted a statement showing details of fabrication work done by sub-contractors and annexed here to as 'annexure a'." from the above statement it will be very clear that these sub-contractors did the work as per specifications and drawings of the clients. however, the adjudicating officer, finds as follows : "the record show that as soon as the officers of the central excise received information regarding the manufacture of utilisation of the goods in dispute they carried out necessary investigation." fabricator has supplied 482.37 mts of raw material in the form of steel plates, channels to various process and the same has been transferred to columns, roof girders, cladding runners, purlins etc. and the activity of this nature certainly amount to manufacture as it brings into existence of a new distinct product having its own name, character and used. the said new product are well known in the market and covered under the central excise tariff act and undoubtedly would attract duty...in the instant case various components/parts by columns roof girders, cladding runner, purlins utilised in the erection of the site cannot be considered as an immovable property can be removed/dismantled as and when required. various pronouncements cited by m/s. des in respect of the arguments were not applicable. further in page 11 of the order it has been stated that items like roof girders, purlins, trusses are well known in the market and are capable of being bought and sold".he cites the judgment of a.p. state electricity board -1990 (70) e.l.t.3 (sc).7. when we look into it the facts of the case, the judgment of the bombay high court cited by the appellant in telco's case - 89 e.l.t.463 is worth referring to. in paragraphs 5,6 and 7 of the said judgment, the division bench of the bombay high court discusses the questions of marketability and the term "manufacture" as held in paragraph 10 after referring to tariff item 7308 which deals with structures etc. as follows: "10. in our opinion, the position is well settled as a result of several judicial pronouncements of the apex court and the high courts: 'manufacture' implies change but every change is not a manufacture. there must be a transformation. a product, with a distinct use, character and name necessarily must come into existence. every product, in order to become exigible to excise duty must be known as such in the commercial community. in the instant case, it is admitted that on the materials like angles, plates, etc. which are used, excise duty is already paid. they are subjected to cutting to size, drilling holes for fastening the materials with nuts and bolts. there is no manufacture in the strict sense. in our view, the cutting of the steel plates, drilling of holes, rivetting or fastening them are merely operations from which one could not hold that the identity of the original product was lost and a transformation had taken place. the columns, beams, trusses and purlins are sections or portions of a structure, come into existence when affixed or fabricated into the structure, thus, simultaneously on coming into existence become part of the structure and thus becoming immovable in character. this is, like preparing/constructing a 'flooring' or a 'wall' of a building which is done by subjecting to further processing articles like cement, sand and tiles in the case of 'flooring' and cement, sand bricks in the case of 'wall'. can it be said that 'floorings' and 'walls' being parts of a building are excisable, undoubtedly the definitions of these items referred to above and the photographs which were produced by the petitioners would show that these 'items' are only portions or sections, of a structure. the other test is: whether they could be separately known as commodities separately bought and sold? the answer could be only in the negative. thus, none of these items, in our view, satisfy the twin tests and are, therefore, not exigible to excise duty." 8. it is true that in sirpur paper mills ltd. 's case -1998 (97) e.l.t.3 the supreme court has said that just because a plant and machinery which fixed in the earth for better functioning it does not automatically become immovable property. but in that case the question decided was based on the question of fact decided by the tribunal and also the tribunal has held that somebody wants to purchase the whole machinery, it could be dismantled and sold to him in part. (please see paras 3 to 6). here the argument dismantling or selling in parts have not arisen. and, therefore, on the peculiar facts and circumstances of the case, the supreme court has held in that way. moreover here it is not a case of mere embedding for operational efficiency. in our view huge steel structure which fixed on earth and the judgment of the bombay high court is squarely applicable to the facts of this case. the judgment of the karnataka high court in thungabhadra steelproducts ltd. v. uoi 1998 (98) e.l.t. 334 also deals with the same questions. and we also follow the judgment of the karnataka high court in the said case of thungabhadra steel products ltd. and which held in favour of the assessee.9. last but not the least an important factor in this case admittedly these products have been manufactured by the sub-contractors. it has been stated in the scn; at page 2 thereof as follows: "it also appears that des entered in civil contract with the client m/s gsl who supplied raw materials and got structurals fabricated from the sub-contractors on des account and therefore m/s. des/gsl vasco are liable to pay an amount of rs. 9,79,498.75 as duty not paid under the provisions of section 11a of the central excises and salt act, 1944." 10. the scn proceeds on the basis that structurals were fabricated by the sub-contractors m/s. ici ltd., madras. in the impugned order, the duty has been demanded from the appellants only and proceedings were dropped against gsl and indian commerce and industry p. ltd. when the admitted position that the fabrications have been done by the sub-contractors, in terms of the decision of the supreme court in ujjagar prints' case, it is sub-contractors who could be held liable for tax, if at all, duty is leviable. in this case we do not have an appeal by the department against such a finding. we are, therefore, of the view that the impugned order is not supported by law. hence the appeal is allowed with consequential relief according to law.11. whether structures later affixed to the earth are excisable and dutiable goods is a vexed question. basically structures are composed of several components such as angles, plates etc. which components are by themselves acknowledged and accepted to be excisable and dutiable articles. the process of manufacture of structures consists of welding, rivetting or otherwise joining a number of such components together; if necessary, by first manipulating such components parts by bending, drilling, punching etc. in certain judgments (not necessarily relating to structures), the courts and tribunal have ruled that mere punching, drilling etc. were processes not amounting to manufacture. such judgments were cited and applied to structures at a later stage holding them as non-excisable. in addition, the view was also held that structures which were embedded in the earth were not "goods" and therefore did not lend themselves to the coverage of the central excise tariff. these judgments have been followed even after heading no. 7803 came into existence.12. as far as the aspect of attachment to earth is concerned, it need not enter the deliberations, where the components are first made in the factory and then the structure is created, which, at the stage of creation itself, is embedded in the earth. this was the view held by the supreme court in the case of hyderabad race course as well as mittal engineering. the supreme court in the case cited by my ld.brother above has gone a step further and held that where the installation is for the sake of stability alone, then the machinery etc. would continue to be called "goods" inspite of being embedded in the earth.13. in examining whether a particular structure is excisable or not, the department has to establish that the processes did amount to manufacture. essentially, every manufacture from a nail to a motor car will involve the same processes namely cutting, shaping, punching, drilling, welding etc. and being put together by nuts and bolts. if these processes are held not to amount to manufacture, jointly or severally, then nothing produced in this country would be subject to duty. in each case it has to be shown by the taxing authority that the particular process did result in creation of new commodity known in the market separately from the inputs going into that commodity.14 these parameters not having been followed by the ld. collector in the impugned order the case against the assessee has not been established. in addition, as far as the conclusion reached by my ld.brother in paragraph 10 above, that the burden of duty was not fastened on the present appellants, is unassailable.

Judgment:
1. The appellants are Civil Engineers and Contractors. They are aggrieved by the Order No. 25/ Collr. Goa/CEX/94, dated 26-12-1994 whereunder they were asked to pay a duty of Rs. 9,79,498/- payable on the Steel Structurals classified also under proviso to Sub-section (1) of Section 11A of the Central Excise Act, 1944. By the said order the Collector also imposed penalty of Rs. 50,000/- for contravention of Rules 173Q and 9(2) of the Central Excise Rules.

2. The appellants are civil engineers and contractors. They undertook what are known as Civil Contracts and also entered into sub-contracts for construction at factory site relating to structural fabrications.

The sub-contractors in this case were Indian Commerce and Industries Co. Ltd. (known as ICI) who were independent fabricators. The appellants entered into contract for building factory and structural fabrications. The dealings between the appellants and its employers Goa Shipyard Ltd. was on principal to principal basis and equally the dealings between the appellants and sub-contractors ICI were on principal to principal basis. Raw material was supplied by the Goa Shipyard Ltd. Out of the price paid by Goa Shipyard Ltd. the appellants retained the middleman trader's profit and pass on the remaining job work charges to the actual fabricator viz. ICI. As stated earlier the fabricator is ICI Ltd., Madras, which was an independent person and not a dummy of the appellants. A SCN was issued on 6-2-1991, (page 2 of the Paper Book) alleging that the appellants had fabricated steel structures and roofing systems weighing 482.376 MTs valued at Rs. 62,19,039.75 during construction of Bay I of M/s Goa Shipyard Ltd. and appellants failed to pay an amount of Rs. 9,79,498.75 by way of duties of Central Excise. The SCN also charged the appellants GSL Vaso of contravening provisions of various Rules like 9, 49, 53,173B, 173C, 173G, etc. and have rendered themselves liable to penalty under the various provisions of the Central Excise Rules. The appellants by their letter dated 5th March, 1991 denied its liability. It stated inter alia that they did not undertake the job of fabrication of steel structures.

In the SCN there is a reference to a statement made by one Shivdas which also states that the appellants submitted the final bills and copies of contracts which were returned to the representative of the appellant after scrutiny. The show cause notice further stated that no appellants submitted copies of running account bills and pre final bill of M/s Indian Commerce and Industries Co. P. Ltd. sub-contractors. The statement of Shri Shivdas, Finance Manager was cited as evidence in respect of the SCN. The period in dispute was from 26-2-1986 to 1-4-1998. The SCN states inter alia that GSL entered into civil contract with the appellant and GSL supplied the raw materials and got the structurals fabricated from the sub-contractors on the appellants' account. Therefore SCN charged appellants were liable to pay the duty.

The appellants filed a reply on 5-3-1991 denying its liability. It stated inter alia in paragraph 2 of its reply that the fabrication was not done by the appellants and whenever it is required they got these items fabricated by other steel fabricators like Indian Commerce Industries, Madras and appellants retained only the middleman trader's profit of 5%. It has been specifically stated in paragraph 2 of the said letter that the Madras firm have carried out the fabrication at the site by engaging their own labourer, on which the appellants did not have any supervision or control. The Madras firm, the job worker it was submitted were independent builders and fabricators having their own rights. In the written submissions filed before the Collector it was submitted that the supervision by the appellants have been confined only to quality control. The basic raw materials was supplied by GSL and the construction was carried out at the site. Without prejudice to what is stated there, the appellants also submitted that fabrication like channels, angles, girders etc. no new product emerged thereby the identity of the individual constituents was never lost. They raised the query that no manufacture within the meaning of Section 2(f) of the Central Excise Act had occurred. They cited various judgments including that of the Supreme Court in Ujjagar Prints Ltd. case. The adjudicating authority on the basis of the materials before him rejected the contentions of the appellants and confirmed the duty demand under the Show Cause Notice and also imposed penalty. Hence the present appeal.

3. Shri M.K. Maingi, ld. Counsel appeared for the assessee and Shri K.M. Patwari, ld. JDR appeared for the department.

4. It is contended by Mr. Maingi, learned Counsel that processes of drilling, welding and fasting does not amount to manufacture and these goods do not become goods within the meaning of Section 2(d) of the Central Excise Act. He cites among other things the judgment of the Tata Engineering & Locomotives v. CCE, 89 E.L.T. 463. He also states that fabrication and erection of structural steel shed on site is not manufacture and relies on the judgment of the Tribunal in the case of Pratap Steel Rolling Mills v. CCE -1990 (48) E.L.T. 539. He also invited our attention to the judgment of the Karnataka High Court in Thungabhadra Steel Products Ltd. v. UOI -1998 (98) E.L.T. 334 for the proposition that assembling of fabricated structure at customer's site would not amount to manufacture. He also cited several other decisions in support of his preposition of law. He stated that under the contract it is the sub-contractors, ICI Ltd., Madras who are the manufacturers being a job worker. In terms of judgment in Supreme Court in Ujjagar Prints case it is the sub-contractors, ICI Ltd., Madras could be the manufacturer no the appellants.

5. In reply, ld. DR while reiterating the impugned order invited our attention of the judgment of Supreme Court in Sirpnr Paper Mills Ltd. v. CCE, Hyderabad -1998 (97) E.L.T. 3 that just because the plant and machinery affixed on earth for better functioning it did not automatically become an immovable property.

6. We have considered the rival submissions. In the SCN, there is a reference to the statement made by Mr. Shivdas, Finance Manager, of the appellants. Points arising under the statement of Shri Shivdas is reflected as under: 2. The cost of raw material was recovered by the clients or pre-fixed rates from the cost of total'contract.

3. Although DES had taken contracts from the clients for civil contracts, the works of structural fabrication was sub-contracted.

5. The sub-contractors did the work as per specifications and drawing of the clients and under general supervision of DES. 6. The sub-contractors were paid for the fabrication by DES as it was part of the general civil contract between DES and the clients.

8. The GSL Vasco contract was substantially completed around December,1989 and it took them about 20 months from commencement.

9. The fabrication was done at clients site. However small parts might have been fabricated outside by the sub-contractors.

10. The deduction of the client on account of raw material supplied is Rs. 37,48,915.50.

11. He also submitted a statement showing details of fabrication work done by sub-contractors and annexed here to as 'Annexure A'." From the above statement it will be very clear that these sub-contractors did the work as per specifications and drawings of the clients. However, the adjudicating officer, finds as follows : "The record show that as soon as the officers of the Central Excise received information regarding the manufacture of utilisation of the goods in dispute they carried out necessary investigation." Fabricator has supplied 482.37 MTs of raw material in the form of steel plates, channels to various process and the same has been transferred to columns, roof girders, cladding runners, purlins etc. and the activity of this nature certainly amount to manufacture as it brings into existence of a new distinct product having its own name, character and used. The said new product are well known in the market and covered under the Central Excise Tariff Act and undoubtedly would attract duty...In the instant case various components/parts by columns roof girders, cladding runner, purlins utilised in the erection of the site cannot be considered as an immovable property can be removed/dismantled as and when required. Various pronouncements cited by M/s. DES in respect of the arguments were not applicable. Further in page 11 of the order it has been stated that items like roof girders, purlins, trusses are well known in the market and are capable of being bought and sold".

He cites the judgment of A.P. State Electricity Board -1990 (70) E.L.T.3 (SC).

7. When we look into it the facts of the case, the judgment of the Bombay High Court cited by the appellant in TELCO's case - 89 E.L.T.463 is worth referring to. In paragraphs 5,6 and 7 of the said judgment, the Division Bench of the Bombay High Court discusses the questions of marketability and the term "manufacture" as held in paragraph 10 after referring to tariff item 7308 which deals with structures etc. as follows: "10. In our opinion, the position is well settled as a result of several judicial pronouncements of the Apex Court and the High Courts: 'Manufacture' implies change but every change is not a manufacture. There must be a transformation. A product, with a distinct use, character and name necessarily must come into existence. Every product, in order to become exigible to excise duty must be known as such in the commercial community. In the instant case, it is admitted that on the materials like angles, plates, etc.

which are used, excise duty is already paid. They are subjected to cutting to size, drilling holes for fastening the materials with nuts and bolts. There is no manufacture in the strict sense. In our view, the cutting of the steel plates, drilling of holes, rivetting or fastening them are merely operations from which one could not hold that the identity of the original product was lost and a transformation had taken place. The Columns, Beams, Trusses and Purlins are sections or portions of a structure, come into existence when affixed or fabricated into the structure, thus, simultaneously on coming into existence become part of the structure and thus becoming immovable in character. This is, like preparing/constructing a 'flooring' or a 'wall' of a building which is done by subjecting to further processing articles like cement, sand and tiles in the case of 'flooring' and cement, sand bricks in the case of 'wall'. Can it be said that 'floorings' and 'walls' being parts of a building are excisable, Undoubtedly the definitions of these items referred to above and the photographs which were produced by the Petitioners would show that these 'items' are only portions or sections, of a structure. The other test is: whether they could be separately known as commodities separately bought and sold? The answer could be only in the negative. Thus, none of these items, in our view, satisfy the twin tests and are, therefore, not exigible to excise duty." 8. It is true that in Sirpur Paper Mills Ltd. 's case -1998 (97) E.L.T.3 the Supreme Court has said that just because a plant and machinery which fixed in the earth for better functioning it does not automatically become immovable property. But in that case the question decided was based on the question of fact decided by the Tribunal and also the Tribunal has held that somebody wants to purchase the whole machinery, it could be dismantled and sold to him in part. (Please see paras 3 to 6). Here the argument dismantling or selling in parts have not arisen. And, therefore, on the peculiar facts and circumstances of the case, the Supreme Court has held in that way. Moreover here it is not a case of mere embedding for operational efficiency. In our view huge steel structure which fixed on earth and the judgment of the Bombay High Court is squarely applicable to the facts of this case. The judgment of the Karnataka High Court in Thungabhadra SteeLProducts Ltd. v. UOI 1998 (98) E.L.T. 334 also deals with the same questions. And we also follow the judgment of the Karnataka High Court in the said case of Thungabhadra Steel Products Ltd. and which held in favour of the assessee.

9. Last but not the least an important factor in this case admittedly these products have been manufactured by the sub-contractors. It has been stated in the SCN; at page 2 thereof as follows: "It also appears that DES entered in civil contract with the client M/s GSL who supplied raw materials and got structurals fabricated from the Sub-contractors on DES account and therefore M/s. DES/GSL Vasco are liable to pay an amount of Rs. 9,79,498.75 as duty not paid under the provisions of section 11A of the Central Excises and Salt Act, 1944." 10. The SCN proceeds on the basis that structurals were fabricated by the sub-contractors M/s. ICI Ltd., Madras. In the impugned order, the duty has been demanded from the appellants only and proceedings were dropped against GSL and Indian Commerce and Industry P. Ltd. When the admitted position that the fabrications have been done by the sub-contractors, in terms of the decision of the Supreme Court in Ujjagar Prints' case, it is sub-contractors who could be held liable for tax, if at all, duty is leviable. In this case we do not have an appeal by the department against such a finding. We are, therefore, of the view that the impugned order is not supported by law. Hence the appeal is allowed with consequential relief according to law.

11. Whether structures later affixed to the earth are excisable and dutiable goods is a vexed question. Basically structures are composed of several components such as angles, plates etc. which components are by themselves acknowledged and accepted to be excisable and dutiable articles. The process of manufacture of structures consists of welding, rivetting or otherwise joining a number of such components together; if necessary, by first manipulating such components parts by bending, drilling, punching etc. In certain judgments (not necessarily relating to structures), the Courts and Tribunal have ruled that mere punching, drilling etc. were processes not amounting to manufacture. Such Judgments were cited and applied to structures at a later stage holding them as non-excisable. In addition, the view was also held that structures which were embedded in the earth were not "goods" and therefore did not lend themselves to the coverage of the Central Excise Tariff. These judgments have been followed even after Heading No. 7803 came into existence.

12. As far as the aspect of attachment to earth is concerned, it need not enter the deliberations, where the components are first made in the factory and then the structure is created, which, at the stage of creation itself, is embedded in the earth. This was the view held by the Supreme Court in the case of Hyderabad Race Course as well as Mittal Engineering. The Supreme Court in the case cited by my Ld.

Brother above has gone a step further and held that where the installation is for the sake of stability alone, then the machinery etc. would continue to be called "goods" inspite of being embedded in the earth.

13. In examining whether a particular structure is excisable or not, the department has to establish that the processes did amount to manufacture. Essentially, every manufacture from a nail to a motor car will involve the same processes namely cutting, shaping, punching, drilling, welding etc. and being put together by nuts and bolts. If these processes are held not to amount to manufacture, jointly or severally, then nothing produced in this country would be subject to duty. In each case it has to be shown by the taxing authority that the particular process did result in creation of new commodity known in the market separately from the inputs going into that commodity.

14 These parameters not having been followed by the ld. Collector in the impugned order the case against the assessee has not been established. In addition, as far as the conclusion reached by my ld.Brother in paragraph 10 above, that the burden of duty was not fastened on the present appellants, is unassailable.