Boiler cinder is not manufacture or excisable goods unless it acquires marketable character under central excise law

Cinder generated in a boiler while coal is burned was not treated as manufacture or as excisable goods under central excise law. The Tribunal applied its earlier view and supporting High Court authority that a by-product or residue does not become liable to duty merely because it is sold or used for filling ditches; it must itself acquire the character of marketable excisable goods. On that basis, boiler cinder was held outside the scope of central excise duty.

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Issues: Whether cinder obtained while burning coal in the boiler in the factory constitutes manufacture and attracts central excise duty.

Analysis: The Tribunal relied on its earlier view that material emerging as a by-product or residue, which is not shown to answer the character of excisable goods, does not become liable merely because it is used for filling ditches or is sold for a price. The Tribunal followed its earlier decision and the supporting High Court ruling to hold that the nature of the cinder did not justify treating its emergence as manufacture within central excise law.

Conclusion: Cinder obtained in the boiler was not treated as manufactured goods chargeable to central excise duty.

Ratio Decidendi: A waste or residue arising in the course of use of raw material is not manufacture or excisable goods unless it acquires the character of marketable goods within the levy.

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