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of <h1>Sulphur Sludge Not Dutiable under CET Act: Tribunal Rules in Favor of Appellants</h1> The Tribunal held that 'sulphur sludge' arising as waste during manufacturing is not dutiable under Chapter No. 3801.90 of the CET Act, 1985. Relying on ... Classification Issues: Classification of 'sulphur sludge' under Chapter No. 3801.90 of CET Act, 1985 and its dutiability under Section 9(2) read with Section 11A of the Central Excises and Salt Act.In this case, the appeal was filed against the Order-in-Original confirming the duty demand on 'sulphur sludge' under Chapter No. 3801.90 of the CET Act, 1985. The appellants argued that the product should not be dutiable as it arose as 'waste and scrap material' during the manufacture of sulphuric acid in their factory. The appellants relied on previous rulings of the Delhi High Court and the Tribunal to support their position. The learned SDR, on the other hand, reiterated the findings of the Collector but acknowledged that the product in question was not manufactured but arose as waste and scrap during the manufacturing process. With the consent of both sides, the appeal was taken up for final disposal by granting a stay.The Delhi High Court ruling in the case of Modi Rubber Ltd. established the principle that waste/scrap obtained during the manufacturing process, without transforming into a new article, is not excisable under the Central Excises and Salt Act. The Court emphasized that waste and scrap lack distinguishing characteristics of goods and cannot be subject to duty. The Tribunal's decision in the case of Asiatic Oxygen Ltd. regarding carbide sludge reiterated that industrial waste, not a marketable commodity, is excisable. The Tribunal further considered spent bleaching earth as waste material, supporting the view that such materials are excisable. In the present case, the Tribunal found that 'sulphur sludge' emerged during the production of sulphuric acid and other products, akin to waste and scrap material, lacking the characteristics of a manufactured item. Therefore, the Tribunal concluded that 'sulphur sludge' does not qualify as goods under the Central Excises and Salt Act, and the duty demand on it was unjustified. The impugned order was set aside, allowing the appeal in favor of the appellants.
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