1993 (5) TMI 92 - AT - Central Excise

Caustic Lye Classified as Excisable Under Central Excise Tariff

The Tribunal upheld the Collector (Appeals)'s order, classifying Caustic Lye as excisable under T.I. 68 of the Central Excise Tariff. Despite being a ... Classification Issues:Classification of Caustic Lye as excisable under T.I. 68 of Central Excise Tariff.Detailed Analysis:Issue: Classification of Caustic Lye as excisable under T.I. 68 of Central Excise TariffThe case involved an appeal against the order passed by the Collector of Central Excise (Appeals), Calcutta, regarding the classification of Caustic Lye as excisable under T.I. 68 of the Central Excise Tariff. The appellants had initially classified Caustic Lye as non-excisable, claiming it was a waste product arising during the manufacture of Oxygen. The Collector (Appeals) held that Caustic Lye was chargeable to duty under T.I. 68 since it contained Sodium Hydroxide and Sodium Carbonate, had marketability, and found use in certain industries.The appellants argued that Caustic Lye was a waste product similar to slag or flux-skimmings, not commercially viable for extraction of Sodium Hydroxide or Sodium Carbonate. They cited previous Tribunal orders and decisions of the Bombay High Court to support their contention that waste products with some marketability are not excisable. The respondents, however, contended that Caustic Lye was marketable, citing the definition of 'Causticised ash' in the Condensed Chemical Dictionary.The Tribunal analyzed the contentions of both parties and examined the manufacturing process of Oxygen at the appellants' plant, where Caustic Lye was generated as a by-product. The Tribunal noted that Caustic Lye contained Sodium Hydroxide and Sodium Carbonate, had some marketability, and was utilized by the appellants in their tube manufacturing unit. Referring to the Supreme Court's judgment in a similar case involving brass scrap, the Tribunal held that even waste products with an established market are excisable under the Central Excise Tariff.Ultimately, the Tribunal upheld the Collector (Appeals)'s order, classifying Caustic Lye as excisable under T.I. 68 of the Central Excise Tariff. The Tribunal found that the Caustic Lye, despite being a by-product of Oxygen manufacturing, had marketability and commercial value, making it subject to duty under the Tariff.This detailed analysis encompasses the arguments presented by both parties, the legal precedents cited, and the Tribunal's reasoning in classifying Caustic Lye as excisable under the Central Excise Tariff.