TaxTMI 
TaxTMI 
1988 (2) TMI 180
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....is stored as Liquid Chlorine. A part of Liquid Chlorine is sold as such in specially made cylinders and the balance is captively consumed in the manufacture of Trichloroethylene. The conversion of Liquid Chlorine into Dry Chlorine takes place in the Chlorine Plant itself before Dry Chlorine is cleared for captive consumption. Prior to 1.5.1980 central excise duty was payable on Chlorine Gas falling under Central Excise Tariff Item 14-H on the basis of Tariff Value and separate Tariff values were fixed for Liquid Chlorine and Dry Chlorine. With effect from 1.5.1980 Tariff Value was abolished and Chlorine became assessable on the basis of the value to be determined under Section 4 of the Central Excises and Salt Act, 1944. The appellants filed a price list seeking approval of the assessable value of Rs. 281.72 per M.T. for Dry Chlorine effective from 1.5.1980. This value was worked out by the appellants on the basis of cost of manufacturing plus manufacturing profit. This price list was provisionally approved by the Assistant Collector of Central Excise after making a minor change in the assessable value by adding a higher margin of profit. Subsequently, after issuing a show cause no....
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....of buyer." 4. Collector (Appeals) has held that duty liability of excisable goods arises under Section 3 of the Central Excises and Salt Act, 1944 which stipulates that all excisable goods shall be liable to duty as and at the rates set forth in the First Schedule to the said Act. Item 14-H of the First Schedule to the Central Excises and Salt Act, 1944 covers Gases, and chlorine is specifically mentioned against sub-item (ii) of Item 14-H. He has also held that for the purpose of excise duty there is no distinction between Chlorine Gas in liquid form and Chlorine in Dry Gas form. Accordingly, he has held, when the assessable value of Chlorine Gas has been determined under Section 4 of the Act, it is that approved assessable value which will govern all clearances from the place of production, whether such clearances are by way of removal for home consumption, or by way of removal for captive consumption. Collector (Appeals) has held that appellants' contention that the provisions of Rule 6(b)(ii) of the Central Excise (Valuation) Rules, 1975 would operate in their case, is without merit. He has also rejected the appellants' contention that the valuation under Section 4 in respec....
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.... the value of Liquid Chlorine is applicable to the Dry Chlorine Gas for captive consumption. 7. We have considered that records of the case and the contentions of both sides. Item 14-H of the First Schedule to the Central Excises and Salt Act, 1944 covers the gases including liquefied or solidified gases. Chlorine is mentioned against sub-item (ii) of the said Tariff Item for the purpose of Tariff classification. Therefore, Chlorine gas, whether liquid or Dry, falls under the same Tariff Heading. This does not, however, mean that Liquid Chlorine and Dry Chlorine are comparable goods or. that assessable value determined for Liquid Chlorine under Section 4(1)(a) of the Central Excises and Salt Act, 1944 is applicable to the Dry Chlorine also. We are unable to accept the finding of the Collector of Central Excise (Appeals) that there is no distinction between Liquid Chlorine and Dry Chlorine Gas for the purpose of valuation for Central Excise duty. Had there been no distinction between the two, there could be no justification for fixing separate Tariff Values for Liquid Chlorine and Dry Chlorine prior to 1.5.1980. In our considered view, Dry Chlorine and Liquid Chlorine are not com....
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.... it should be deemed to have been removed from the factory. Clearly, the tariff value has to be related to this point of time and consequently it sould be the tariff value applicable to the goods in form they were in at that time, namely, gas." 8. In the above mentioned reported case, this Tribunal did not agree with the lower authority that identical product could not have different value. The Tribunal also held that Tariff values fixed by the Notification for Dry Chlorine Gas and Liquid Chlorine Gas should be applied for assessable value of respective forms of gases. In the aforesaid case also, Dry Chlorine Gas was utilised for captive consumption. Fortified by Explanation (ii) below Rule 49 of the Central Excise Rules, the Tribunal held in that case that Chlorine was in the form of Gas immediately before its utilization and at that point of time it should be deemed to have been removed from the factory. Consequently, the Tariff Value applicable to Dry Chlorine Gas should be applied to the Dry Chlorine utilized for captive consumption. Similar circumstances exist in the present case. Immediately before the Chlorine was utilized for captive consumption in the manufacture of Tri....