Coal cinder as boiler residue was not excisable goods, so the central excise duty demand and penalty failed.

Coal cinder arising from burnt coal was treated as residue or waste, not as excisable goods under Tariff Item 68, even though it could fetch a sale price. A trade notice could not determine excisability by itself, and the reasoning applied to waste and scrap supported the view that such residue did not acquire the character of goods for central excise purposes. As no tariff entry covered it as excisable goods, the duty demand failed, and the penalty based on the same premise also could not stand.

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Issues: Whether coal cinder arising from the burning of coal was excisable goods liable to Central Excise duty under Tariff Item 68, and whether the penalty imposed for breach of the Central Excise Rules could stand.

Analysis: Coal cinder was found to be only a residue or waste left after coal was burnt in boilers and, though capable of fetching some sale price, it did not acquire the character of goods for the purpose of Central Excise law. A trade notice issued by the Collectorate could not by itself determine excisability. The reasoning adopted in earlier decisions on waste and scrap, including the treatment of waste matter as non-excisable and the inapplicability of removal restrictions to such waste, was applied to the present facts. Since the material was not shown to be covered by any tariff entry as excisable goods, the basis for duty demand disappeared, and the penalty founded on the same premise could not survive.

Conclusion: Coal cinder was not excisable goods under Tariff Item 68, and the duty demand and penalty were unsustainable.

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