TaxTMI 
TaxTMI 
1998 (5) TMI 185
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....he plants. As the ammonium bicarbonate in the manufacture of which the same is consumed captively, is a dutiable product, carb-liquor enjoys exemption under Notification No. 217/86. Dispute relates to the quantity of carb-liquor consumed captively in the manufacture of ammonium sulphate and the duty has been confirmed by denying the benefit of Notification No. 217/86-C.E. as the final product is exempted. 3. The process of coming into existence of the said `carb-liquor', as detailed by the appellant in their written note is as under :- Process adopted 8.1 In the top tower, called the secondary carbonation tower, liquid ammonia is absorbed in condensate water to obtain ammoniated liquor. This is then pumped to the primary carbonation tower where carbon di-oxide is introduced. 8.2 Inside this carbonation tower, on account of reaction of ammonium with carbon di-oxide, a liquor consisting of free ammonia, free carbon di-oxide, ammonium bi-carbonate, ammonium carbonate, all in water is formed. The process is carried out at a pressure of 20 p.s.i. 8.3 For case of convenience, the Sindri plant has given the nomenclature "carb-liquor" to the mixture remai....
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....d dictionaries, he submitted as follows :- "14.1 Encyclopedia of Chemical Technology by Kirk-Othmer reads as under : Ammonium Carbonate Normal ammonium carbonate [506-87-6] (NH4)2 CO3, can be prepared by passing gaseous carbon dioxide into aqueous ammonia solution in a column or similar absorption apparatus and causing the vapours (ammonia, carbon dioxide and water) to distil. A solid crystalline mass condenses. ......... 14.2 It is seen from the above extract that vapours are distilled. This is the post-reaction operation necessary as per the technical book. Further, the ammonium carbonate is a solid crystalline mass and emerges by condensation during distillation. 15 Hawley's Condensed Chemical Dictionary indicates the derivation of ammonium carbonate as "ammonium salts heated with calcium carbonate". The method of purification is indicated as "sublimation". (Sublimation is the method by which vapours straightaway condense into solid form without going through the intermediate stage of liquid state). 16 Even the HSN Explanatory Notes under Heading 28.36 state that commercial ammonium carbonate included in the Heading occurs in a white crystal....
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....e submitted that the duty has been rightly demanded on the carb-liquor; which has been consumed captively, by denying the benefit of Notification No. 217/86-C.E., as the final product ammonium sulphate was exempt. 8. As regards limitation, ld. Counsel reiterated the reasoning adopted by the Commissioner in his impugned order. He submitted that the appellants have, while declared the production and captive consumption of carb-liquor in the manufacture of ammonium bi-carbonate, a dutiable product, they have suppressed the fact that a substantial quantity of the same is being used by them captively in the manufacture of exempted ammonium sulphate. Accordingly, he submits that the extended period has been rightly invoked by the Commissioner. He also justified imposition of penalty. 9. We have given our careful consideration to the submissions made by both the sides. Following legal issues arise out of the present appeal for our consideration. (a) Whether `carb-liquor' is marketable and hence, excisable; (b) Whether the demand is barred by limitation; (c) and whether the appellants are liable to penalty. 10. As regards the first point, the....
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....long as they are available for purchases. The Court also observed that marketability of article does not depend upon the number of purchases nor is the market confined to the territorial limits of this country. Applying the above principles laid down by the Supreme Court on the evolution of the concept of marketability based on earlier Apex Court's decisions, it is clear that even one transaction of sale and purchase is sufficient to establish marketability. The evidence of actual sale of carb-liquor on the record is sufficient to demolish the apppellant's case on the point of marketability. Accodingly, we hold that the `carb-liquor' is excisable to duty under Tariff Heading 2836.90 of CETA, 1985. 11. However, we find that the appellant has a strong case on limitation. The show cause notice has been admittedly raised after the normal period of limitation of six months. Letter dated 12-1-1982 referred above in support of conclusion of marketability strengthens the appellant's case on limitation in as much as by the said letter the department was made aware of the manufacture of carb-liquor, its captive consumption in the manufacture of aluminium sulphate and the department w....