2012 (10) TMI 230

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....During the manufacture of sponge iron, fine particles come into existence, which are being called as iron ore fines . The said iron ore fines are being cleared by the appellant without payment of duty in terms of exemption Notification No.4/06. 3. The Revenue s case is that the input service stands utilised in the manufacture of dutiable, i.e., sponge iron as also non-dutiable goods, i.e., sponge ore iron fines and as such, input service credit is required to be paid to the extent of 10% in terms of the provisions of Rule 6(3)(b). Accordingly demand was raised against the respondent and confirmed to the extent of Rs.7,72,286/- by the original adjudicating authority. However, on appeal, Commissioner (Appeals) set aside the same by observi....

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.... mm are also obtained, which they termed as Iron ore fines. There are not usable in the kiln for the purpose of recovery of sponge iron. Nevertheless what is obtained as iron ore fine are smaller pieces of iron ore. It continues to be the same material as that of initial iron ore but of smaller size and not usable in the factory of the appellant. Since these are not usable in the factory, the same is sold by the appellant as waste, which are usable by others for recovery of iron. It, therefore, follows that the iron ore fines is not different from the present raw material in name, character and use except in smaller size and therefore, it cannot be termed as a product which came into existence as a result of process of manufacture. Further ....