TaxTMI 
TaxTMI 
1985 (4) TMI 297
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....encies took the slurry for recovery of calcium chloride, but this forms a very small part of the waste thrown away by Gwalior Rayon Factory. The slurry waste was not sold to Jameco Agencies. 2. No contradiction was made to the above story in the Collector's order, which records that the assessee wrote to the Superintendent of Central Excise, Nagda in March 1979 that neutralization of hydrochloric acid was a regular feature. The Collector ended his order (No. 2/80 T.I. 14G dated 28-7-1981) by saying that neutralized hydrochloric acid in the form of slurry constituted goods on which duty should have been paid when supplied to a customer. 3. The learned counsel for the factory told us at the Bench that the goods was of no use to them. Th....
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....r use and the Supreme Court judgment in the famous DCM case will have the effect of drawing this slurry into excisability. It may not have come to market but marketability was not a necessary qualification, according to the South Bihar Mill decision of the Supreme Court 1978 E.L.T. J 336. The 1980 E.L.T. 146 decision on Indian Aluminium was about dross and skimmings, rubbish and scum. This neutralised slurry was not such a commodity. The judgments quoted by the appellants are totally irrelevant. 5. The counsel for M/s. Gwalior Rayon returned to say that slurry was not a name, much less a new name. The Supreme Court said the goods ' must be ordinarily sold; the expert said the waste was not marketable. The Government has not discharged it....
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....mission for it (neutralization) The Collector certainly does not accuse them of neutralizing the hydrochloric acid, a distinct commodity assessable to central excise duty, without permission. In para 4.5, the order affirms that neutralization was done with the full knowledge of the central excise officers. 8. Can we then say that the neutralization was for producing a new commodity? We do not think so. It was for destroying a commodity, hydrochloric acid. And we do not see how the factory would have neutralized hydrochloric acid to produce a new commodity for so long and the central excise do nothing about it. They should have stopped it, or better still, clamped down central excise control, supervision etc. etc. to ensure that duty was ....
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....aid it was a dross, a skimming, a by-product, a sub-standard goods, a surplus, and so on and so forth, but no. They said it was neutralised hydrochloric acid; they do not refute the factory's claim that it was a destruction. The Collector very fairly accepts (para 4.4) there was no wilfulness about the neutralization, meaning thereby, that the neutralization was not a cover for something, but that it was a straightforward operation and that it was what it said it was, and that it did not lead to any unlawful act. The slurry/effluent/neutralized acid, therefore, was not a goods created for profit, or capable of bringing profit. 10. This is not invalidated by the fact that the waste suddenly found a use one day. Many wastes, even human was....