Non-excisable granulated slag led to no duty demand, no exemption denial and no penalty on settled Tribunal reasoning.

Granulated slag arising inevitably in the manufacture of pig iron was treated as non-excisable on the basis of earlier Tribunal rulings on molten slag, granulated slag and blast furnace slag. On that view, no duty demand could be sustained, denial of exemption under the notification did not arise, and no contravention of its conditions could be alleged merely because the product was held non-excisable. The commentary records that, once the goods were regarded as non-excisable waste or by-product, the associated penalty could not survive. The appeal was stated to have been allowed.

---

---

Issues: Whether granulated slag arising in the manufacture of pig iron was excisable and, if it was non-excisable waste or by-product, whether the demand of duty, denial of exemption, and penalty could be sustained.

Analysis: The Tribunal found that slag arose inevitably during the manufacture of pig iron and that earlier Tribunal decisions had already held molten slag and granulated slag to be non-excisable. Once the product itself was held to be non-excisable, the question of denying exemption under the notification did not arise, and no contravention of its condition could be alleged on that basis. The Tribunal also noted that the impugned goods were covered by the settled view that blast furnace slag was not excisable, and therefore no duty demand or penalty could survive.

Conclusion: Granulated slag was held to be non-excisable, so the duty demand and penalty were unsustainable and the appeal was allowed.

---