TaxTMI 
TaxTMI 
2024 (9) TMI 837
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....ure of Sulphuric Acid. B. Whether the Tribunal properly acted as the appellate authority under Section 35C of the Central Excise Act, 1944 as the impugned order is not a speaking order? C. Whether the Tribunal correctly relied upon the decisions in the case of Union of India vs. Hindustan Zinc 2014 (303) ELT 321 (SC) and Sterlite Industries India Ltd. vs. CCE 2016 (331) ELT 255 (Tri Chennai)? D. Whether oxygen manufactured from a plant, in turn utilized in the manufacture of sulphuric acid (cleared at nil rate) would be exempted from levy of excise duty in terms of Notification No. 67/95-CE dated 16.03.1995?" [2] The brief facts of the case are that the respondent - M/s. Hindalco Industries Limited is engaged in the manufacture of Copper Cathodes, Continuous Cast Copper Rods, Sulphuric Acid, etc. falling under CETH 74228 of the Central Excise Tariff Act, 1985. [2.1] The respondent has an oxygen gas producing plant within their factory premises and oxygen produced in the oxygen plant is further used in manufacture of Copper Cathodes and Sulphuric Acid. The manufacturing process involved is that the Copper Concentrate is mixed with the Silica and char....
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....rpose of manufacture of Cathodes only was incorrect and accordingly, duty and penalty were imposed upon the respondent - assessee, as stated hereinabove. [3] Being aggrieved by the Orders-in-Originals, the respondent filed appeal before the CESTAT, which are allowed by the impugned order setting aside the Orders-in-Originals. [4] The Tribunal allowed the appeal in view of the decision of the Hon'ble Supreme Court in the case of Union of India vs. Hindustan Zinc Ltd reported in 2014 (303) ELT 321 (SC). The Tribunal also observed that the said decision has been followed in the case of Sterlite Industries India Ltd vs. CCE, Tirunelveli reported under 2015 (331) ELT 255 (Tri. Chennai). The Tribunal, after following the decision in the case of Sterlite Industries India Ltd (supra), which is similar to the facts of the case as well as the facts before the Hon'ble Apex Court held that the orders-in-original are without any merit and accordingly, the same were set aside. [5] Having considered the impugned orders, we are of the opinion that the Tribunal has rightly held that the issue raised in the appeals are no more res integra as the same has already been settled by the Hon'ble ....
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....lant but from the atmosphere. The Sulphur Dioxide (SO2) combines with atmospheric oxygen and gets converted into Sulphur Trioxide (SO3). This Sulphur Trioxide is absorbed in Sulphuric Acid to form Oleum. This super-saturated Oleum is dissolved in water to produce 98% pure Sulphuric Acid (H2SO4) i.e. the fourth element of oxygen is derived from water. This fact is easily verifiable from the manufacturing process. It is evident that oxygen produced in their plant is captively consumed and used only in the copper concentrate for purification and not diverted elsewhere for process of conversion of SO2 or SO3 or to Sulphuric Acid. Therefore, on merit itself it is established that oxygen produced captively is not used as an input in the manufacture of Sulphuric Acid and appellant is eligible for Notification No. 67/95 on oxygen on merit. 9. Further, it is pertinent to state that so long as Oxygen produced in their plant is used captively in the manufacture of final product (i.e.) copper concentrate and cleared on payment of duty, the appellants are rightly eligible for exemption under Notification No. 67/95 for oxygen. The case of the department is that appellant used the inputs....
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....ument of the Union of India as to whether literal interpretation is to be given to Rule 57CC, it would be necessary to understand the properties of sulphuric acid. From what is explained above including the use of sulphuric acid for the production of zinc, it becomes apparent that sulphuric acid is indeed a by-product. In fact, it is so treated by the respondents in their balance sheet as well as various other documents which were filed by the respondents in the courts below. It is also a common case of the parties that Hindustan Zinc Limited and Birla Copper were established to produce zinc and copper respectively and not for the production of sulphuric acid. It was argued by the learned Counsel for the respondents, which could not be disputed by the learned Solicitor General, that emergence of sulphur dioxide in the calcination process of concentrated ore is a technological necessity and then conversion of the same into sulphuric acid as a non-polluting measure cannot elevate the sulphuric acid to the status of final product. Technologically, commercially and in common parlance, sulphuric acid is treated as a by-product in extraction of non-ferrous metals by companies not only in....
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....e Glycol was reacted with DMT to produce polyester and ethanol. Methanol was not excisable while polyester fibre was liable to excise duty. Credit was taken of duty paid on ethylene glycol wholly for the payment of duty on polyester. The department took a position that ethylene glycol was used in the production of methanol and proportionate credit taken on ethylene glycol was to be reversed. This Court ruled that the emergence of methanol was a technological necessity and no part of ethylene glycol could be said to have been used in production of methanol and indeed it was held that the total quantity of ethylene glycol was used for the production of polyester. The fact in all these three appeals appear to be identical to the facts and the law laid down in Swadeshi Polytex (supra). Therefore, this judgment is squarely applicable. 26. Furthermore, the provisions of Rule 57CC cannot be read in isolation. In order to understand the scheme of Modvat credit contained in this Rule, a combined reading of Rules 57A, 57B and 57D along with Rule 57CC becomes inevitable. We have already reproduced Rule 57D above. It can be easily discerned from a combined reading of the aforesaid pro....
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....hat as per Notification No. 67/95, both input oxygen and the final products are rightly covered in the Table of the Notification. Proviso (vi) of the notification stipulates that this notification is applicable provided appellant complied with Rule (6) of CCR, 2001. The only condition is that sub-rule (2) of Rule 6 of CCR is required to be complied with. In the present case, as per sub-rule (2), appellant manufactured oxygen used in the manufacture of excisable product and they had no obligation to maintain separate accounts for oxygen used in the manufacture of Sulphuric Acid. It is established that appellant did not use oxygen produced in the manufacture of Sulphuric Acid. Accordingly, conditions of Notification No. 67/95 are complied. By respectfully following the Apex Court decision in the case of UOI v. Hindustan Zinc Ltd. (supra), we hold that appellants are eligible for benefit of Notification No. 67/95 and the duty demand on the quantity of oxygen so used in the manufacture of sulphuric acid, is liable to be set aside. Consequently, no penalty survives and it is set aside. Impugned order is set aside and the appeal is allowed." [6] Thus, considering the observations made....