S. H. SHETH, J. ( 1 ) ALEMBIC Glass Industries Limited is the petitioner. The petitioner is manufacturing glass and glassware which fall under Tariff Item No. 23a in the First Schedule to the Central Excises and Salt Act 1944 The petitioner has got a factory at Baroda in the State of Gujarat. The glass and glassware produced by the petitioner-Company are purchased by wholesale buyers. Anyone can buy the petitionercompanys products in wholesale. Amongst the buyers of the excisable goods produced by the petitioner-Company are manufacturers of medicines producers of oil manufacturers of chemicals and milk dairies. It is the case of the petitioner-Company that it is not necessary that glass and glassware manufactured by it should be sold in packed condition. According to them they can be sold in naked condition. The petitioners next contend that in some cases their buyers supply the packing material and sometimes they purchase the packing material from the market pack the goods in it and sell them to their wholesale buyers. The petitionercompanys buyers sometimes require a particular kind of packing as for example in cartons or in corrugated sheets. Others are satisfied with ordinary packing consisting of hay or straw padding in gunny bags. The petitioner further contends that under Tariff Item 17 in First Schedule to the Central Excises and Salt Act 1944 excise duty is leviable on packing materials themselves. It is further alleged that the cost of packing material is borne by the buyer and that the petitioner shows the price of the excisable goods and the price of packing material separately in its pricelist. It is next alleged that price of packing material is not identifiable with the value of the excisable goods and that therefore excise duty cannot be levied on the composite price of the excisable goods as well as the packing material. Next the petitioner allege that packing material is not a part of the manufacturing process. In other words according to them it is not incidental to manufacture. The petitioner further avers that packing is done for the safety of the goods during transportation and that no further manufacturing process is applied to packing material. After amended sec. Next the petitioner allege that packing material is not a part of the manufacturing process. In other words according to them it is not incidental to manufacture. The petitioner further avers that packing is done for the safety of the goods during transportation and that no further manufacturing process is applied to packing material. After amended sec. 4 of the Central Excises and Salt Act 1944 came into force on October 1 1975 the Central Excise authorities started assessing the excise duty on the composite price of excisable goods as well as packing material and did not approve the pricelist submitted by the petitioner showing the prices of excisable goods alone. ( 2 ) THE petitioner therefore filed this petition in which two reliefs are claimed :- (1) Definition of the expression value given in clause (d) of subsec. (4) of sec. 4 of the Central Excises and Salt Act 1944 is beyond the legislative competence of Parliament under Art. 246 of the Constitution read with Entry 84 in the Union List; and (2) any collection of excise duty on the basis of this definition is without authority and bad in law and is hit by Art. 265 and Art. 31. ( 3 ) IN order to examine the first contention which has been raised on behalf of the petitioner it is necessary to reproduce the definition of value given in sec. 4 (4) (d) of the Central Excises and Salt Act. It is in the following terms :-" (D) value in relation to any excisable goods- (i) where the goods are delivered at the time of removal in a packed condition includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee. It is in the following terms :-" (D) value in relation to any excisable goods- (i) where the goods are delivered at the time of removal in a packed condition includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee. EXPLANATION :-In this sub-clause packing means the wrapper container bobbin pirn spool reel or warp beam or any other thing in which or on which the excisable goods are wrapped contained or wound; (II) does not include the amount of the duty of excise sales tax and other taxes if any payable on such goods and subject to such rules as may be made the trade discount (such discount not being refundable on any account whatsoever) allowed in accordance with the normal practice of the wholesale trade at the time of removal in respect of such goods sold or contracted for sale;"let us now analyse this definition. This definition in terms excludes from the value of excisable goods the cost of packing which is of a durable nature and which is returnable by the buyer to the assessee. The expression returnable used in the definition suggests that actual return of the packing material of a durable nature by the buyer is not of any great consequence. In other words what is excluded from the value of the excisable goods is the cost of packing which is of a durable nature and which can be returned by the buyer to the assessee irrespective of whether he returns it or not. Excluding such cost of packing the cost of other packing is required to be included in the value of the excisable goods in order to find out its assessable value for the purpose of collecting excise duty. ( 4 ) NOW packing material may originate broadly speaking from three sources:- (i) the buyer may supply the packing material and the manufacturer may pack his excisable goods in it and deliver them to the buyer (ii) the manufacturer may buy it from the market pack the goods in it and deliver it to the buyer; and (iii) the manufacturer may himself manufacture it pack the goods in it and deliver to the buyer. So far as the last category is concerned it can be sub-divided into two parts; packing material which a manufacturer manufactures may be an integral part of the process of manufacture of excisable goods or it may not be such an integral part of the manufacturing process applied to the excisable goods. It is quite probable that the packing material manufactured by a manufacturer may itself be subject to duty of excise. It may as well be not subject to it. We have not examined this aspect in details because it is not necessary for us to do it in this case. In this case it is undisputed on record that either the petitioner Companys buyers supply the packing material or the petitioner-Company purchases packing materials from the market packs the excisable goods in them and delivers them to its buyers. Therefore the question which has arisen before us is whether the cost of parking material supplied by the buyer to the manufacturer or the cost of packing material purchased by the manufacturer from the market for the purpose of packing the excisable goods in it and delivering it to its buyer can be included in the assessable value of the excisable goods. Ordinarily the measure or standard of assessable value which the Parliament prescribes cannot be called in question unless while doing to it has entrenched upon a forbidden field. We shall revert to this aspect a little later. ( 5 ) LET us first examine some of the definitions given in the Central Excises and Salt Act 1944 Sec. 2 (d) defines excisable goods so as to mean goods specified in the First Schedule as being subject to a duty of excise and includes salt. There is no doubt or dispute about the fact that glass and glassware which the petitioner-Company manufactures fall under Entry 23a in the First Schedule to the said Act. Sec. 2 (f) is very material for the purpose of this case. It defines manufacture in the following terms :-" (F) manufacture includes any process incidental or ancillary to the completion of a manufactured product; and (I) in relation to tobacco includes the preparation of cigarettes cigars cheroots biris. Sec. 2 (f) is very material for the purpose of this case. It defines manufacture in the following terms :-" (F) manufacture includes any process incidental or ancillary to the completion of a manufactured product; and (I) in relation to tobacco includes the preparation of cigarettes cigars cheroots biris. cigarette or pipe or hookah tobacco chewing tobacco or snuff; (IA) in relation to manufactured tobacco includes the labelling or relabelling of containers and repacking from bulk packs to retail packs or the adoption of any other treatment to render the product marketable to the consumer. (II) xxx xxx xxx (III) in relation to patent or proprietary medicines as defined In Item No. 14e of the First Schedule and in relation to cosmetics and toilet preparations as defined in Item No. 14f of that Schedule includes the conversion of powder into tablets or capsules the labelling or relabelling of containers intended for consumers and repacking from bulk packs to retail packs or the adoption of any other treatment to render the product marketable to the consumers; (IV) in relation to goods comprised in Item No. 18a of the First Schedule includes sizing beaming warping wrapping winding or reeling or any one or more of these processes or the conversion of any form of the said goods into another form of such goods; and the word 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;"this long definition of manufacture makes it clear beyond any doubt two propositions. Firstly process of manufacture includes any process incidental or ancillary to the completion of a manufactured product. The second proposition which is made clear is that wherever the Parliament wanted to include in the process of manufacture certain incidental or ancillary processes it has said so as for example in sub-clause (i) of clause (f) and in sub-clause (ia) of clause (f ). ( 6 ) MR. Patel has invited our attention to sec. 2 (k) which defines the expression wholesale dealer. It is not necessary to make any reference to it because for the purpose of deciding this case nothing turns upon it. Mr. Patel has invited our attention to sec. ( 6 ) MR. Patel has invited our attention to sec. 2 (k) which defines the expression wholesale dealer. It is not necessary to make any reference to it because for the purpose of deciding this case nothing turns upon it. Mr. Patel has invited our attention to sec. 3 and emphasized the fact that this section which is the charging section levies a duty of excise on all excisable goods other than salt. This aspect he has emphasized with reference to several kinds of goods specified in the First Schedule. In other words according to him when sec. 3 is read in light of Item 23a in the First Schedule it is very clear that the width and amplitude of sec. 3 is to impose or to levy only upon glass and glassware the excise duty. According to him therefore sec. 4 by artificially defining the valuation of excisable goods cannot go beyond the charging section and levy excise duty on something which does not form a part of the value of the excisable goods. He has in particular emphasized the fact that in case of glass and glassware packing material is absolutely independent of the excisable goods. ( 7 ) HE has invited our attention in that behalf to the decision of the High Court of Bombay in OGALE GLASS WORKS V. UNION OF INDIA (1975) 79 BOM. L. R. 37. In that case Ogale Glass Works Limited were manufacturers of glass and glassware. The pricelists approved by the Excise authorities included the cost of packaging and the petitioners in that case from 1962 to 1972 paid whatever amounts were demanded from time to time by the Excise authorities. This the petitioners paid a duty of about Rs. 12 lakhs. A part of this payment represented legitimate excise duty on the excisable goods namely glass and glassware. But it also included a payment purporting to be excise duty on the cost of packing and packing materials. In December J972 the petitioners in that case made a representation to the Excise authorities that revised pricelists should be approved in accordance with the law by excluding the packing charges. They were emboldened to make that application because of the decision of the Mysore High Court in the case of Messrs Alembic Glass Industries Limited. The Excise authorities refused to comply with the request of the petitioners. They were emboldened to make that application because of the decision of the Mysore High Court in the case of Messrs Alembic Glass Industries Limited. The Excise authorities refused to comply with the request of the petitioners. Therefore they filed a Writ Petition in the High Court of Bombay for directions to the Central Excise authorities to repay the excess illegal recoveries made by them on such packing charges from 1962 to 1972. They further contended that they had paid the excise duty on packing charges under a common mistake since the inception. ( 8 ) THE High Court of Bombay held that the cost of packing and packing materials could not be legally included in arriving at the wholesale cash price of the excisable goods manufactured by the petitioners. It was further held that the method or manner of marketing delivering or transporting excisable goods which have been fully manufactured can never by itself determine the assessable value of such excisable goods under sec. 4 of the Central Excises and Salt Act 1944 It was further held by the High Court of Bombay that packing of glass and glassware is not a process incidental or ancillary to the completion of its manufacture. Therefore the cost of packing and packaging material cannot be included in the value of glass and glassware for the purpose of levy and collection of excise duty. ( 9 ) THIS decision makes it clear that in case of glass and glassware the packing material does not constitute a process incidental or ancillary to the completion of the manufactured product. indeed the aforesaid decision of the High Court of Bombay was rendered on the basis of old sec. 4 which has now been amended. At that time the expression value was not defined by Parliament. The amended section defines that expression and includes in the value of the excisable goods the cost of packing which otherwise would not have been included in it. The question therefore is whether the cost of packing could be included in the value of the excisable goods by Parliament competently under Entry 84 of the Union List. ( 10 ) MR. Patel has argued that cost of packing is a post manufacturing or non-manufacturing operation. According to him excise duty on packing material overreaches Entry 84 of the Union List and sec. ( 10 ) MR. Patel has argued that cost of packing is a post manufacturing or non-manufacturing operation. According to him excise duty on packing material overreaches Entry 84 of the Union List and sec. 3 of the Central Excises and Salt Act and is therefore bad in law. In that context he has invited our attention to Entry 17 in First Schedule which according to him read in light of sec. 3 provides for levy of excise duty on packing material. We may however state that reference to Item (1) is not at all helpful because it refers to paper packing and not packing in wooden cartons and such other things in which generally glass and glassware are packed. He has also submitted that packing services are rendered free of charge by the petitioner-Company to its buyers. This fact has not been disputed on behalf of the respondents in the affidavit-in-reply. ( 11 ) NOW let us examine the nature of the excise duty which is collected on the cost of packing and packing material which either a buyer supplies or which a manufacturer from the market purchases and in which he packs his excisable goods for delivery to his buyers. It cannot be gainsaid that packing material which the buyer supplies or which a manufacturer purchases from the market has nothing whatsoever to do with the manufacturing process of the excisable goods nor is it in any way incidental or ancillary to that manufacturing process. In fact not an iota of manufacturing process incidental or otherwise can by any stretch of imagination be applied to the supply of packing material by the buyer or purchaser of packing material by the manufacturer from the market. Therefore in our opinion the packing material which the buyer supplies or the manufacturer purchases from the market is so independent of the manufacturing process of the excisable goods and so divorced from it that it is not even within a reasonable distance from the manufacturing process applied to the excisable goods. We concur in this behalf in the view expressed by the High Court of Bombay in the case of Ogale Glass Works (supra ). We concur in this behalf in the view expressed by the High Court of Bombay in the case of Ogale Glass Works (supra ). Now if the packing material supplied by a buyer or purchased by a manufacturer from the market has nothing whatsoever to do with the manufacturing process applied to the excisable goods what is the nature of the tax which the manufacturer pays to the Central Excise authorities on the cost of packing or packing material ? ( 12 ) IN any case it is not excise duty firstly because the packing material is not manufactured by the manufacturer as an integral and inseverable part of the product. Therefore the question of manufacturing costs and manufacturing profits in respect of such packing material does not arise so far as the manufacturer is concerned. Therefore there cannot be any assessable value in respect of such packing material and the tax collected is not excise duty within the meaning of Entry 84 in the Union List. Therefore the tax collected on the price of such packing material is not excise duty. It may also be noted that in such a case whoever manufactured the packing material from whom the manufacturer of excisable goods purchased it must have paid excise duty if otherwise it was subject to excise duty. When the manufacturer purchase in the open market and supplies it to his buyer who pays the manufacturer its price the tax collected on this activity will partake of the character of purchase tax or sales tax. It would be purchase tax if it is levied on purchase by the buyer or the petitioner from the market and it would be a sales-tax if there is levy on the sale thereof by the manufacturer of the excisable goods to his buyer. It is clear therefore that the impost on packing material under the aforesaid circumstances falls under Entry 54 in the State List. Obviously therefore the Parliament cannot levy and collect it. ( 13 ) EXCISE duty can be levied on excisable goods. Indeed it can be levied at different stages at which the goods undergo transformation and new goods or commodities are brought into existence. Change of identity or emergence of a new article or commodity is the test for levying excise duty afresh. ( 13 ) EXCISE duty can be levied on excisable goods. Indeed it can be levied at different stages at which the goods undergo transformation and new goods or commodities are brought into existence. Change of identity or emergence of a new article or commodity is the test for levying excise duty afresh. Where the packing material is purchased by the manufacturer from the market and is used for packing the excisable goods there is no change of identity of goods nor does a new article emerge which may attract the levy of a fresh excise duty. Similarly if a buyer supplies the packing material to the manufacturer or excisable goods the packing material so supplied by the buyer does not undergo any change of identity nor does it give birth to a new excisable commodity. Therefore levy of duty on the manufacturer of excisable goods after the manufacturer of packing material paid it when he cleared them from his factory would mean payment of excise duty twice. There is no provision in the Central Excises and Salt Act 1944 for levying excise duty twice on the same article or commodity which has not changed its identity and which has not become a new marketable commodity. ( 14 ) SUPPORT is lent to this view by a decision of the Supreme Court in SOUTH BIHAR SUGAR MILLS V. UNION OF INDIA A. I. R. 1968 S. C. 922 in which the principle which the Supreme Court has laid down in the context of the Excise Act is that the Act charges duty on manufacture of goods and that the word manufacture implies a change but every change in the raw material is not manufacture. It has been further observed in that decision that there must be such a transformation that a new and different article must emerge having a distinctive name character or use. ( 15 ) IT has been argued by Mr. Vakil on behalf of the respondents that the levy of excise duty on packing material under the aforesaid circumstances is not a tax on sale or purchase. It has been argued by him that a tax levied on the first sale may be in addition to the tax on manufacturing costs and manufacturing profits. According to him therefore it is covered by Entry 97 in the Union List. It has been argued by him that a tax levied on the first sale may be in addition to the tax on manufacturing costs and manufacturing profits. According to him therefore it is covered by Entry 97 in the Union List. We are unable to accept this argument on account of the reasons which we have stated earlier. In our opinion for the reasons stated above it amounts to purchase tax or sales-tax. ( 16 ) IT has next been argued by Mr. Vakil that the Parliament may levy tax on something more than the manufacturing costs and manufacturing profits. In our opinion it cannot be done if it entrenches upon the State List. Parliament cannot levy in the name of duty of excise within the meaning of Entry 84 in the Union List something which falls under the State List and which is beyond its legislative competence. ( 17 ) IT has also been argued by him that packing costs are not postmanufacturing costs and post-manufacturing profits. In our opinion they certainly enjoy that character because they have nothing to do with the manufacturing process or activity and they are incurred after manufacturing process or manufacturing activity is over or complete. Reliance has been placed on the unreported decision of this Court in Special Civil Application No. 858 of 1974 decided by Mr. Justice J. B. Mehta and Mr. Justice M. P. Thakkar an September 8 1976 That decision has no application to the instant case because this Court in that case was concerned with marketing expenses included in the assessable value of excisable goods. In that case this Court upheld the contention that marketing expenses could be induced in the assessable value of excisable goods. The question which has been put to us in an oversimplified form is:- If marketing expenses cat he included in the excisable value of excisable goods why can the cost of packing material not manufactured by the manufacturer of excisable commodity not be included as an integral and inseverable part; of its manufacturing process ? The reasons which this Court gave while upholding that argument strike down the very basis of the argument which Mr. Vakil. has advanced before us. According to this Court marketing costs may in a given case have relation to manufacturing costs when they are required to be put in the stream of trade. The reasons which this Court gave while upholding that argument strike down the very basis of the argument which Mr. Vakil. has advanced before us. According to this Court marketing costs may in a given case have relation to manufacturing costs when they are required to be put in the stream of trade. Secondly packing costs are relatable to it manufacturing operations only after the goods have been purchased and after they have entered the stream of trade and await delivery. Relying upon Rule 9 of the Central Excise Rules he has argued that packed condition is part of the manufacturing process This argument cannot hold good even for a moment where the buyer supplies the packing material to the manufacturer of excisable goods or the manufacturer of the excisable goods purchases the packing material from the market in order to pack his goods. Rule 9 therefore has no application to the instant case. ( 18 ) THE next argument which he has advanced is that manufacture is complete when excisable goods are packed and delivered and that until then the manufacturing activity in respect of the excisable goods is not complete. This is too wide an argument to be accepted. It is not so in all cases where the buyer supplies the packing material or the manufacturer of excisable commodity purchases it from the market. It can never be said that the manufacture of excisable goods is complete only when it is packed and delivered. ( 19 ) MR. Vakil has then pressed into service Article 250 of the Constitution. The arguments which he has advanced in support of this contention are the same which he advanced in Special Civil Application No. 119 of 1975 (CIBATUL LTD. V. UNION OF INDIA 21 G. L. R. 284 ). The contention based on Article 250 has not been pleaded by the respondents in their affidavit-in-reply. Obviously therefore the petitioner did not have an opportunity to meet this contention. Under these circumstances the petitioners cannot be taken by surprise. For the reasons stated by us in Special Civil Application No. 119 of 1975 we reject this contention. ( 20 ) IN the result we are of the opinion that so far as the definition of value given in sec. Under these circumstances the petitioners cannot be taken by surprise. For the reasons stated by us in Special Civil Application No. 119 of 1975 we reject this contention. ( 20 ) IN the result we are of the opinion that so far as the definition of value given in sec. 4 (4) (d) of the Central Excises and Salt Act is concerned cost of packing and packing material in cases in which the buyer supplies the packing material or the manufacturer purchases it from the market and packs the excisable goods do not form a part of the value of the excisable goods because tax on them falls within Entry 54 in the State List in respect of which Parliament is not competent to legislate. We read down the definition accordingly and hold that the definition of value has no application to these two categories of packing matter. We are not expressing any opinion in this petition on two sub-categories of the third category of packing material because it is not necessary for us to do so in this case. . ( 21 ) THE petitioner has tried to file a Civil Application for amendment of the original petition in the course of the hearing of this petition. We are unable to entertain this application at such a late stage. It is therefore rejected. As a result of the finding which we have recorded on the definition of value in sec. 4 (4) (d) we direct the respondents to make account of the excess duty recovered by them from the petitioner from October 1 1975 till date and submit it to the petitioner for verification on or before August 30 1979 After it has been verified by the petitioners the respondents shall refund to the petitioner such amount as is undisputed between them. If any part of the refund is disputed by the respondents and which the petitioner claims the petitioner shall be at liberty to adopt its own remedy for its recovery. This relief has not been specifically prayed for in the petition. We have given this direction as a consequential relief following upon our reading down the definition of value. ( 22 ) RULE is made absolute to the aforesaid exent. The respondents shall pay the costs of this petition to the petitioner. This relief has not been specifically prayed for in the petition. We have given this direction as a consequential relief following upon our reading down the definition of value. ( 22 ) RULE is made absolute to the aforesaid exent. The respondents shall pay the costs of this petition to the petitioner. ( 23 ) IT appears that in pursuance of the interim order made by this Court the petitioner has furnished the Bank Guarantee. The respondents are therefore directed to pay to the petitioner the costs incurred by them for furnishing the Bank Guarantee. The respondents shall do so within two months from the date on which the petitioner submits to the respondents a statement of costs in this behalf. ( 24 ) WHATEVER amount is found refundable to the petitioner as a result of this order shall bear interest at the rate of six per cent per annum from the date of the petition until payment and the respondents shall pay it to the petitioner. ( 25 ) IT appears that the Bank Guarantee furnished by the petitioner expired on or about June 30 1978. If the respondents are desirous of having a fresh Bank Guarantee they are at liberty to apply to this Court. ( 26 ) MR. Shelat who appears on behalf of the respondents applies for stay of the operation of this order for some time. We direct that the order made herein shall not operate until July 31 1979. ( 27 ) MR. Shelat applies for a certificate of fitness under Article 133 (1) of the Constitution in order to enable the respondents to appeal to the Supreme Court against this order. In our opinion this petition raises a substantial question of law as to the interpretation of sec. 4 (4) (d) of the Central Excises and Salt Act 1944 We therefore grant the certificate of fitness under Article 133 (1 ). Petition allowed: Leave to appeal granted. .