In Brief
A company imported diesel-powered generator sets (Gensets) and placed them inside steel containers, adding cooling radiators, ventilation fans, air filters, oil tanks, pipes, pumps, and other components to create portable "Power Packs" for leasing to customers. The company challenged the excise authorities' determination that this process constituted taxable 'manufacture'. The Supreme Court held that the containerization and addition of essential components transformed the imported Gensets into distinct products—Power Packs—with their own character, identity, and functional utility (portability). These components are integral 'parts' necessary for the Power Pack to function, not mere accessories. Both the transformation test (new product with distinct character) and marketability test (commercially viable) were satisfied. The appeals were dismissed; the company is liable for excise duty on the manufactured Power Packs.
The lawyer headnote and full judgment text are available to registered users.