MANUFACTURE AND DEEMED MANUFACTURE
Definition of Manufacture
As per Section 2 (f)
Manufacture includes any process,
(i) incidental or ancillary to the completion of a manufactured product;
(ii) which is specified in relation to any goods in the Section or Chapter Notes of the Schedule to the Central Excise Tariff Act, 1985 as amounting to manufacture;
or
(iii) which, in relation to goods specified in the Third Schedule of Central Excise Act, involves packing or repacking
of such goods in a unit container or labelling or re-labelling of containers including the declaration or alteration of retail sale price on it
or adoption of any other treatment on the goods to render the product marketable to consumer
and the term manufacturer shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account
Analysis
An inclusive definition of Manufacture is given in Section 2(f)
It states that apart from the general meaning of manufacture, it also includes the certain other things, like
-
Any incidental process to manufacture
Example :If Scrap produced during manufacture of Final product, duty may be applicable on
scrap also
-
Any Process specified in CETA as manufacture
Examples of Such processes which are treated as Deemed Manufacture
- Galvanization of iron and steel
- Recording of sound on audio or video tapes/CDs
- Process of cutting, slitting and printing of aluminum foils
-
For Goods specified in Third Schedule of CEA
(those goods whose MRP to be declared),
Activities like labelling or re-labelling of containers including the declaration or alteration of
retail sale price
Note
Activities covered in 2 and 3 above are called Deemed Manufacture
