TaxTMI 
TaxTMI 
2015 (6) TMI 116
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....g to the bar imposed under Section 35(1) of the Act, 1944. The order/judgment of the Commissioner (Appeals) dismissing the appeals preferred by these petitioners is based upon the decision rendered by Hon'ble Supreme Court in the case of Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others as reported in (2008) 3 SCC 70, which speaks that if there is delay of more than 30 days, then under Section 35 (1) of the Act, 1944 the Commissioner (Appeals) has no power to condone the delay. Thus, the delay was not condoned by Commissioner (Appeals) and, therefore, these petitioners preferred appeals before CESTAT, which has also dismissed the appeals preferred by these petitioners, confirming the order passed by Commissioner (Appeals) and, therefore, these writ petitions have been preferred by these petitioners. 2. Learned counsel appearing for the petitioners submitted that the petitioners are invoking the writ jurisdiction of this Court under Article 226 of the Constitution of India, mainly for the reason that the order passed by the Commissioner (Appeals), refusing to condone the delay beyond 30 days, may be under Central Excise Act, 1944, but, whenever there i....
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....ich is definition of a word "excisable goods" and Section 2(f), which is definition of a word "manufacturer". With the help of these, Section 3 and two definitions, it has been submitted by the learned counsel for the petitioners that they are manufacturing galvanized tubes and in that process, Zinc dross ("Zn-dross") is also produced, which is a by-product. This product is also known as "Zn-dross" in the language of manufacturers. It is contended by the learned counsel for the petitioners that "Zn-dross" is not excisable at all, because it is never manufactured by the petitioners, even though it is saleable, marketable and capable to fetch some sale price. To substantiate his argument, learned counsel for the petitioners has relied upon a decision rendered by Hon'ble the Supreme Court in the case of Collector of Central Excise, Patna Vs. Tata Iron & Steel Co. Ltd. as reported in (2004) 9 SCC 1, specially paragraphs 2, 11, 12, 14, 15, 16 & 17 etc. thereof. This judgment is absolutely upon "Zn-dross". Learned counsel for the petitioners has also relied upon a judgment delivered by the Hon'ble Supreme Court in the case of Commissioner of Central Excise Vs. Indian Aluminium Co....
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....esumption for manufacturing and it is consistent argument of these petitioners that they have never manufactured this "Zn-dross" nor they have produced the same and, therefore, it is not "excisable goods" and, therefore, tariff Entry No. 7902-0010 to "Zn-dross" is not helpful to the respondents. 7. Learned counsel for the petitioners is also relying upon a circular bearing no. 904 dated 28th October, 2009, and on the basis of the said circular it is submitted by learned counsel for the petitioners that by this circular, the Central Board of Excise and Customs has stated that such type of matters arising between period 2005 to 2008 should be kept in a 'Call book' because one matter is already pending before the Hon'ble Supreme Court. This aspect of the matter has not been properly considered by the Assistant Commissioner, Central Excise, Jamshedpur while passing the order in O-in-O and hence O-in-O passed in all these writ petitions deserves to be quashed and set aside. 8. Learned counsel appearing for the respondents submitted that looking to Section 3 of the Act, 1944 to be read with Section 2(d) and 2(f) and also looking to the percentage of Zinc in "Zndross", the b....
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....ed in the arguments, this Court will have to permit up-to 99.99% Zinc in "Zn-dross". This will lead to absurdity because at one stage there will not be much difference between pure Zn liquid and the "Zn-dross" having 99.99% Zinc. This demarcating line between Zinc and "Zn-dross" has already been drawn by the legislature that if Zinc is up-to 90-92% in a "Zndross" the said liquid will be termed as "Zn-dross" liquid and beyond that, or if percentage of Zinc is more in the said liquid, it will be an "excisable goods" falling within Section 2(d) and even though it is a by-product, the same is a "manufacturing of a byproduct". It is commercially another item. It is marketable commodity and hence no illegality has been committed in imposing and levying excise duty on the goods in question. It is further submitted by the learned counsel for the respondents that in fact the factual aspects have already been crystallized in the O-in-O and the appeal against O-in-O has already been dismissed, because it was beyond the period of condonable delay and as CESTAT has also dismissed the appeal for facts there is a concurrent finding of facts. So far as law is concerned, as stated hereinabove, the ....
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....said writ petitions passed by Assistant Commissioner of Central Excise, Jamshedpur are in gross violation of the Act, 1944. Therefore, the question before this Court is whether "Zn-dross" is excisable goods or not. There is one more question before this Court to the effect that these petitioners were slow enough which, in the eye of law, is known as lethargic enough to prefer appeals, under Section 35 of the Act, 1944. The period of limitation is 60 days and the delay which can be condoned by the Commissioner (Appeals) is of 30 days and not beyond that. These petitioners had preferred appeals beyond the limitation period and also beyond the condonable period and, hence on the basis of decision rendered by Hon'ble the Supreme Court in the case of Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others as reported in (2008) 3 SCC 70, their appeals were dismissed because delay was not condoned by the Commissioner (Appeals). These orders passed in appeals preferred by these petitioners were further challenged before CESTAT, East Regional Bench, Kolkata under Section 35B of the Act, 1944. Obviously, based upon the same decision of Singh Enterprises Vs. Commissio....
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....ls have been dismissed by Commissioner (Appeals) or by CESTAT, under Section 35 and 35B respectively because their appeals were beyond the period of condonable delay. (iv) It has been held by Hon'ble High Court of Gujarat in paragraph 19 of the decision rendered in the case of D.R. Industries Ltd. & Anr. Vs. UOI & Ors. as reported in 2008 (229) E.L.T. 24 (Guj.) as under :- "19. As regards the contention that there may be extra-ordinary cases where assessees may not be in a position to challenge the order of the adjudicating authority before the Commissioner (Appeals) within a period of 90 days from the date of communication of the order, we are of the view that in such extra-ordinary cases where an assessee can show extra ordinary circumstances explaining the delay and also gross injustice done by the adjudicating authority, the assessee may invoke the writ jurisdiction of this Court. Hence, in cases where the assessees have suffered gross injustice and they could not file appeals before the Commissioner (Appeals) within a period of 90 days from the date of communication of the order-inoriginal on account of circumstances beyond their control, such assessees can invoke the po....
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....r notes of [The First Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to [manufacture; or] (iii) which in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labelling or relabelling of containers including the declaration or alteration of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer;] and the word "manufacture" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account;] 3. Duties specified in [the Schedule and the Second Schedule to the Central Excise Tariff Act, 1985] to be levied. - (1) [There shall be levied and collected in such manner as may be prescribed,- (a) [a duty of excise to be called the Central Value Added Tax (CENVAT)] on all excisable goods [(excluding goods produced or manufactured in special economic zones)] which are produced or manufactured in India as, and at the rates, set forth in the First Schedule to the Central Ex....
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....Central Excise, Jamshedpur. Therefore, "Zn-dross" is undoubtedly produced by these petitioners and they are produced as a by-product of galvanized tubes. Several times it happens that several by-products are also produced whenever main product is being manufactured. For example :- A + B ⇄ C + D If A+B are the raw materials and if the main manufacturing item is 'C' and if the product 'D' is also, under compulsion, manufactured, in that situation "D" is known as a by-product. This by-product may be a desirable item or may be an undesirable item. If this by-product is commercially another item and if it is marketable item and if it is saleable and purchasable in the open market then the production of 'D', even though there was no intention on the part of manufacturer to produce goods "D", is always excisable. In the facts of the present case also, "Zn-dross" is commercially another item produced as a by-product - may be compulsory by-product - may be undesirable by-product. Nonetheless if it is saleable and purchasable in the open market, it is marketable goods and hence this "Zn-dross" is excisable goods arising out of manufacturing process of galvaniz....
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....urt to maintain consistency and if 99% of the contents of Zinc in "Zn-dross" is allowed and if it is said it is also not an excisable excisable goods, then there can also be a matter having 99.99% contents of Zinc in a "Zn-dross". That will also not be an excisable goods and ultimately it will lead to an absurd situation that even a pure Zinc manufactured, which is having a purity 99.999999% of Zinc in a Zinc dross (which is almost a pure Zinc produce process) will also be a non-excisable goods. This is not permissible in the eye of law. For ready reference, paragraph 9 of the order passed in O.-in-O of Assistant Commissioner of Central Excise, Jamshedpur in in Writ Petition (T) No. 79 of 2015 reads as under:- "With the introduction of eight digit tariff code in Central Excise Tariff (Amendment) Act, 2004 with effect from 28.02.2005 the Zinc Dross with minimum 90-92 % of Zinc contents - free of skimming in the context of ISRI Code words have been classified specifically under Tariff Item No. 79020010 of the CETA, 1985 considering the percentage of zinc content in it and attracted Central Excise Duty @ 16 % Adv. Though the zinc dross produced by M/s Neepaz Tube Pvt Ltd had zinc con....
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....y are commercially another item, capable of being marketable, i.e. capable of being sold and purchased in the market, then these types of by-products are also manufactured by the concerned assessee and, therefore, Section 2(f) is applicable and as the by-product is marketable and as it is capable of being sold and purchased and in the market and as they are commercially another item they are covered by definition of word "excisable goods" under Section 2(d) and, therefore, under Section 3 of the Central Excise Act, 1944 excise duty can be imposed and levied upon these manufacturing goods looking to tariff prescribed and in the facts of the present case is tariff entry No. 7902-0010. In the facts of the present case "Zn-dross" has been sold away by these petitioners in the open market. There is definite sale value of the "Zn-dross" and, therefore, ad valorem duty is levied by the order of Assistant Commissioner of Central Excise, Jamshedpur and thus no illegality has been committed by the Assistant commissioner of Central Excise in passing Order-in-Originals. (x) Learned counsel appearing for the petitioners has placed heavy reliance upon decisions rendered by Hon'ble the Supreme C....