M. Santhanam, Member (J)

1. The Collector of Central Excise Customs, Jaipur, has preferred this Appeal to set aside the order of the Appellate Collector who in Appeal No. 46/JPR/83, dated 21-2-83 has set aside the order of the Assistant Collector, Central Excise, Ajmer dated 14-7-83.

2. The facts of the case are briefly as follows :-

The Respondents are engaged in the manufacture of marble slabs and were licensed for the purpose under the Central Excise Rules. The marble blocks belong to third parties and are brought to the cutting unit of the Respondents for being sawn into slabs. The sawing is a delicate and technical process carried out by power-operated machines. The slabs so manufactured out of the marble blocks are returned to the parties. The Respondents made a representation on 22-6-1982 and applied for cancellation of their L-4 licence. They inter alia urged that the marble slabs cut by them would not fall under Item 68 of the Tariff. They were collecting only the job-charges and their activity cannot be construed as " manufacturer ". They also placed reliance on the decision of the Appellate Collector, Central Excise, Delhi, in the case of M/s. Universal Marble India (Private) Limited at Makrana. The Assistant Collector, Ajmer, however, rejected the application for cancellation of L-4 licence and for exempting the firm from excise control. Aggrieved by the order, an appeal was preferred to the Appellate Collector, Central Excise, New Delhi. He set aside the order holding that mere sawing of rough marble blocks into slabs would not amount to "manufacture".

3. On behalf of the Appellants, Shri Laxmi Kumaran, S.D.R., argued that the process of sawing marble blocks by the use of sophisticated machinery would bring into existence a commercially identifiable product, viz., marble slabs which have a distinct name, character and use, The marble slabs are usable and marketable as such; the marble slabs are distinct from raw materials, viz. the marble blocks. He relied on the following rulings : -

1. Union of India v. D.C.M. (1977 E.L.T. 199) .

2. South Bihar Sugar Mills v. Union of India (1978 E.L.T. 336).

3. 1982 Supreme Court 127 {Idandas v. Phadika).

4. 1982 E.L.T. 253, Kores (India) Limited v. Union of India.

5. 1981 ECR 151 (Sabarkand Distt. Co-operative v. Union of India).

6. 1980 E.L.T. 735 Hyderabad Asbestos Cement Products Ltd. v. Union of India.

7. 1980 E.L.T. 735 {Brooke-bond v. Union of India).

8. 1983 E.L.T. 1736 (Bom.) (New Shakti Dye Works v. Union of India).

9. 37 STC 392 {State of Orissa v. Patel Saw Mills).

10. 44 STC 191 (M. Narayanan Nambia v. State of Kerala).

4. Based on these citations Shri Laxmikumaran argued that if the process would bring into existence a new and commercially identifiable product, with distinct name, character and use, the contentions of the Deptt. should be upheld. He submitted that marble blocks are not marketable as such, whereas, marble slabs are marketable. He relied on the new Encyclopaedia Britannica 15th Edition, Volume 11 at pages 486 and 487 and argued that sawing blocks into slabs with sets of parallel blades was described as a manufacturing method. He also described the process of marble blocks being made into fine marble slabs. The marble blocks are mined in the form of boulders in the quarry. They are cured in water for a week. Thereafter, they are sent underneath the sawing machine. During the course of sawing, a continuous flow of water is allowed. After the slabs are cut and polished, other refined techniques are adopted to complete manufacture of the slabs. He endeavoured to point out that the further processing would not be determining factor of manufacture. The S.D.R. vehemently urged that the Govt. of India granted total exemption to 'cut' and 'polish' diamonds as also 'cut' or 'polished' diamonds under Notification No. 320/77-C.E. , dated 18-11-77, which showed that cutting or polishing have been treated as distinct manufacturing activities for central excise