Customs, Excise and Gold Tribunal - Delhi
Collector Of C. Ex. vs Dharangadhara Chemical Works Ltd. on 3 July, 1992
Equivalent citations: 1992(62)ELT346(TRI-DEL)
ORDER
Harish Chander, President
1. Collector of Central Excise, Madurai, has filed an appeal being aggrieved from the order passed by the Collector of Central Excise (Appeals) Madras. Shri L.N. Murthy, the learned J.D.R., has appeared on behalf of the appellant and pleaded that the dispute is about the availing of set off in respect of Barium Carbonate used for purification of brine solution which is used for manufacture of caustic soda. Shri Murthy relied on the Order-in-Original but fairly stated that the decisions in the following cases are against the Revenue :
1) Collector of Central Excise v. Ballarpur Industries Ltd. reported in 1989 (43) E.L.T. 804 (S.C.)
2) Collector of Central Excise, Bhubaneswar v. Titaghur Paper Mills reported in 1985 (21) E.L.T. 901 (Tribunal) .
Shri Murthy pleaded that in view of the above decisions, it is left to the discretion of the Bench. Shri B.B. Gujral, the learned advocate, has appeared on behalf of the respondents. He stated that there is no merit in the Revenue's appeal. He cited the following orders:
(1) Order No. 436/85-C, dated 6-6-1985 of the Tribunal in the case of
Collector of Central Excise v. Jayashree Chemicals Ltd
.
(2)
The Andhra Sugars Ltd. v. C.C.E., Guntur, reported in 1985 (22) E.L.T. 594 (Tribunal) (3) Kothari Industrial Corporation Ltd., Madras v. Collector of Central Excise, reported in 1988 (36) E.L.T. 721 (Tribunal) (4) Collector of Central Excise v. Gujarat Alkalies & Chemicals Ltd., reported in 1990 (46) E.L.T. 65 (Tribunal) Shri Gujral pleaded that the Revenue authorities have not implemented the order passed by the Collector (Appeals) and the respondents had filed a writ petition for implementation of the order. In the...result, the Collector had implemented the order and the respondents did get the refunds due. He pleaded for the dismissal of the appeal.
2. We have heard both the sides and have gone through the facts and circumstances of the case. The facts are not disputed. The product in dispute is Barium Carbonate (Ba2 Co2) which is used for the purification of the brine solution which is used for manufacture of caustic soda. Relevant para from the Order No. 436/85-C, dated 6-6-1985 (Appeal No. E. 1842/84-C) of C.C.E., Bhubaneswar v. Jayashree Chemicals Ltd . is reproduced below:
"The question is whether the input which is either raw material or component parts is essential for the manufacture of the final product i.e. Caustic Soda. It is an admitted case of the parties that the Barium Carbonate is used in purifying the brine. The brine so purified with the aid of Barium Carbonate is further used in the manufacture of Caustic Soda by electrolytic process. The contention of the learned departmental representative that Barium Carbonate falling under T.I. 68 should directly go in the manufacture of Caustic Soda finished product for availing the benefit of Notification 201/79-C.E. as amended by Notification No. 105/82-C.E. is not supported by the notification. Caustic soda manufactured by the respondent in its plant at Ganjam is by means of a continuous electrolysis process. In this process the raw material Brine is used for the manufacture of Caustic soda the finished product. Barium carbonate is used for the purpose of removal of impurities like Calcium, Magnesium, Sulphate and Silica. These impurities have to be removed before the electrolytic process is applied. In this integrated process for the manufacture of Caustic soda how can it be said that Barium Carbonate falling under T.I. 68 is not entitled for the benefit of exemption Notification No. 201/79 as amended by Notification No. 105/82-C.E. The Barium Carbonate was used in a manner that contributed to the creation of the caustic soda by removing the impurities in the brine from which the soda was electrolysed out, and in the process it (Barium carbonate) was consumed. Anyone who understands the "input output" theory of modern economics will recognise the truth of this. As input that goes directly into the manufacture may be the first claimant; it is by no means the only claimant. Brine is the principal raw material for the manufacture of Caustic soda and before Brine is used for manufacturing Caustic soda it has to be purified by removing its impurities like Calcium, Magnesium, Sulphate and Silica. Barium Carbonate is used for purifying Brine and therefore the appellants are entitled to avail the credit of the duty paid on such Barium Carbonate under Notification 201/79 as amended by 105/82-C.E. if the other conditions laid down therein are fulfilled."
3. In view of the above discussion, we are of the view that Barium Carbonate is used for purifying brine and the appellants are entitled to avail the set off in respect of the Barium Carbonate used for purifying brine under Notification No. 201/79-C.E. as amended by Notification No. 105/82-C.E. if the other conditions laid down therein are fulfilled. In the result, the appeal filed by the Revenue is dismissed.