Per Justice U.L. Bhat :

This appeal is directed against order-in-appeal dated 10.11.1989 passed by the Collector of Central Excise (Appeals), Calcutta, confirming the order-in-original dated 8.8.1988 passed by the Assistant Collector of Central Excise, Berhampore.

2. On two price lists, both effective from 1.3.1986 in part VII filed by the appellant, the jurisdictional Superintendent issued show cause notice dated 6.6.1988 stating that appellant was manufacturing dutiable product and the value declared was not correct, in as much as the value of pipes and pipe fittings supplied by customers, the forwarding charges, packing charges and rubber lining charges had not been included in the assessable value. The notice proposed inclusion of these additional elements in the assessable value. Appellant resisted the notice contending that the processes undertaken by the appellant did not amount to manufacture, that the articles produced were not in any manner different from the pipes received from the customers and, therefore, the product covered by the price lists was not excisable or dutiable. The Assistant Collector held that assessable value should not include the cost of raw materials, namely, steel frames and structures received from the customers but should include the elements of packing charges and incidental expenses. This order was challenged before the Collector (Appeals) by the Department under Section 35E (4) of the Central Excises Act, 1944. The present appellant did not challenge the order before the Collector (Appeals). The Collector (Appeals) set aside the order passed by the Assistant Collector and directed inclusion of the value of raw materials supplied by the customers, in the assessable value of the finished product. This order is now challenged.

3. The only contention raised by the learned counsel for the appellant in the course of arguments is that the various processes undertaken by the appellant do not amount to manufacture as defined in Section 2 (f) of the Central Excises Act, 1944, since the processes did not convert the pipes into a new product known to the trade with a distinct name, character or use. Learned counsel for the appellant referred to certain decisions where the scope of expression "manufacturer" as defined in the Act has been explained. In one of the cases, it was held by the Supreme Court that although a degree of processing is involved in preparing tinned pineapple slices from the original pineapple yet the commodity continues to possess its original identity and there was no manufacture. In another case, it was held that re-rubberisation and relining of old rollers would not amount to manufacture. The High Court of Bombay in a case held that lacquering/metallising of PVC film would not amount to manufacture. Shri M. Ali, JDR, on the other hand, referred to a decision of the Tribunal which held that re-glass lining of old and used glass amounted to manufacture. He also relied on a decision which held that cutting of aluminium circles from aluminium sheets would amount to manufacture.

4. We considered the identical contention raised by the same appellant in a batch of appeals E/1506 to 1511/89-A disposed of by final order No. 795-800/97-A dated 2.5.1997 [reported in 1997 (21) RLT 507 (CEGAT)]. and took a view against the appellant.

5. The various processes undertaken by the appellant were described thus in the earlier batch of appeals:-

"Pipes are supplied by customers. Flanges are procured from the market and are welded into the pipes ...... After the fabrication, as per the thickness of rubber lining, the rubber sheets are prepared from out of the rubber compound by a calender machine. The aforesaid fabricated pipes are then sand blasted and the surface is prepared for rubber lining. The rubber sheets are then cut to particular size and are lined inside the pipes through bonding agents (adhesives). The said bond agents are also procured from outside market. The pipes duly rubber lined are