Exemption for unwrought zinc turns on whether exempt zinc ash can qualify as duty-paid input material.

Notification No. 224/1988 extended exemption to unwrought zinc manufactured from zinc dross, zinc ash or residues only where the input material had already suffered excise duty or additional customs duty. The dispute concerned whether zinc ash, said to fall within Chapter 26 and earlier exempted under Notification No. 19/88, could still satisfy the "duty already paid" condition. Because the question overlapped with an issue already referred to a larger Bench, the matter was not finally decided and was directed to be heard together with the earlier appeal by a three-Judge Bench.

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Issues: Whether unwrought zinc manufactured from zinc ash was entitled to exemption under Notification No. 224 dated 23-6-1988, and whether zinc ash on which no excise duty was payable under Notification No. 19/88 could be treated as material on which duty had already been paid.

Analysis: The order notes that Notification No. 224 extended exemption to unwrought zinc manufactured from zinc dross, zinc ash or residues thereof on which excise duty or additional customs duty had already been paid. It also records that zinc ash was claimed to fall within Chapter 26 of the Central Excise Tariff Act, 1985 and that goods in that chapter had earlier been exempted under Notification No. 19/88. Since the dispute turned on whether exempt zinc ash could satisfy the condition of duty already paid, and a similar question had been referred to a larger Bench, the matter was not finally decided.

Outcome: The appeals were directed to be tagged with the earlier civil appeal for hearing by a three-Judge Bench.

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