Excise Duty is Applicable Or Not

[MAYUR DODIYA]

Dear Expert,

 I want to know that Excise Duty is applicable or Not on the following procedure:-

Mr X. is producing the following finished Goods:-

       NAME                                          GRADE

1. Sodium Chloride I.P. (salt) - above 99.5 percent   [ Chapter Heading no.- 25]

2. Potassium Chloride I.P.     - above 99.5 percent    [ Chapter Heading no.- 31]

3. Ammonium Chloride I.P.   - above 99.5 percent

And the following Raw Materials is used:-

          NAME                                       GRADE

1. Sodium Chloride I.P. (salt) - 98.5 to 99 percent

2. Potassium Chloride I.P.     - 98 to 99 percent

3. Ammonium Chloride I.P.   -  99 percent

Now Mr.X only Purifies the above Raw materials and produce the finished goods. And this above Salt is Purified by Washing Centrifuge & Drying. During purification of Raw Materials there is no change in Chemical Composition or Structure of the materials in the process.

AI Summary

Purification of Sodium, Potassium, and Ammonium Chlorides Not Subject to Excise Duty Due to No Manufacturing Change An individual inquired whether excise duty applies to the purification process of certain chemicals, specifically Sodium Chloride, Potassium Chloride, and Ammonium Chloride, where no change in chemical composition occurs. An expert responded, clarifying that for a product to be subject to excise duty, it must result from a manufacturing process that creates a new product with a different name, character, or use. Since the purification process merely removes impurities without altering the product's fundamental nature, it does not constitute manufacturing. This interpretation aligns with previous tribunal rulings, indicating no excise duty is applicable in this case.