Packaging Activity Amounts To ‘Manufacturing’, Service Tax Not Payable: CESTAT

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that packaging activity amounts to manufacturing, and therefore, service tax is not payable. The case involved a company engaged in packaging goods for its clients. The tribunal found that the packaging activity resulted in a new product with a distinct name, character, and use, qualifying it as manufacturing under the Central Excise Act, 1944. This ruling clarifies the tax treatment of packaging activities, providing relief to businesses involved in such operations.