Predominant metal test: copper alloy products remained eligible for exemption despite incidental zinc admixture.

Copper sheets and circles made from copper scrap mixed with duty-paid zinc ingots were treated as an alloy in which copper remained the predominant metal by weight. Applying Note 3 to Section XV of the Central Excise Tariff Act, 1985, the product was classified by reference to the metal that predominates, so the incidental admixture of zinc did not take it outside Notification No. 149/86. The exemption claim was therefore accepted, the denial of benefit was set aside, and the appeals were allowed.

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Issues: Whether copper sheets and circles manufactured from copper scrap mixed with duty paid zinc ingots to the extent of 40% were eligible for the benefit of Notification No. 149/86, having regard to Note 3 to Section XV of the Central Excise Tariff Act, 1985.

Analysis: The goods were manufactured out of copper scrap in admixture with zinc ingots. Note 3 to Section XV provides that an alloy of base metal is to be classified as the alloy of the metal which predominates by weight over the other metals. On that basis, copper remained the predominant metal despite the addition of zinc. The view was supported by the Tribunal's earlier decision extending the notification benefit to copper castings made with small quantities of other metals.

Conclusion: The goods were held eligible for the benefit of Notification No. 149/86 and the denial of exemption was set aside in favour of the assessee.

Final Conclusion: The exemption claim succeeded and the appeals were allowed.

Ratio Decidendi: Where the base metal predominates by weight in an alloy, incidental admixture of other metals does not take the product outside an exemption notification tied to the base metal.

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