TaxTMI 
TaxTMI 
2000 (4) TMI 64
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....s. Phoenix Metals Pvt. Ltd. removed these ingots for supply to appellants without payment of duty claiming exemption under Notification No. 43/75, dated 1-3-1975. A demand of Rs. 7,34,047.29 for the period from 1-9-1983 to 31-12-1983 was made on the appellant alleging that conditions relating to exemption under Notification No. 43/75 under which appellants removed the castings without payment of duty were not satisfied. Adjudicating authority by order-in-original, dated 31-8-1984 confirmed the demand taking the view that since M/s. Emmes Metals Pvt. Ltd. and M/s. Phoenix Metals Pvt. Ltd. were exempted units, that it cannot be verified whether they had discharged the duty liability or not and in the absence of any documentary evidence of payment of duty produced by the appellants, they are not entitled to the benefit of Notification No. 43/75, dated 1-3-1975. This order was taken in appeal before the Collector of Central Excise (Appeals), Mumbai. Appellate Authority by Order-in-Appeal No. M-266/B-II-49/85, dated 25-3-1985 remanded the matter to ascertain whether the castings were manufactured from scrap and to verify whether appropriate rate of duty of excise leviable under law and ....
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....ng benefit under Notification No. 43/75, dated 1-3-1975, the castings were manufactured by the appellants. The scrap generated in the process of the manufacture of the casting was sent to M/s. Ishwar Metals for further conversion into ingots. M/s. Emmes Metals Pvt. Ltd. and M/s. Phoenix Metals Pvt. Ltd., when cleared the ingots in favour of the appellants, claimed the benefit of notification and thereby the goods must be deemed to have been subject to payment of duty, namely, nil duty. These duty-paid goods were utilised by the appellants in making the ingots. The scrap generated by them was rerolled into ingots by M/s. Ishwar Metals who cleared them claiming the benefit of Notification No. 43/75. The ingots thus obtained from M/s. Emmes Metals Pvt. Ltd., M/s. Phoenix Metals Pvt. Ltd. and M/s. Ishwar Metals are made out of duty-paid aluminium. Those ingots went into the manufacture of castings by the appellants. In this view of the matter, according to the learned Counsel, the castings are entitled to the benefit of the exemption Notification No. 43/75. 4.Learned Departmental Representative raised the contention that the appellants did not make aluminium castings from old aluminiu....
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.... goods claiming the benefit of Notification No. 43/75. By claiming the benefit of that notification, they did not pay any duty, because as per the notification, the rate of duty was nil. Nil rate of duty is also a rate of duty. Merely because those manufacturers of the ingots were exempted by Notification No. 43/75 from paying duty, it cannot be presumed that the ingots were not duty-paid. Excisable goods do not become non-excisable by reason of exemption given under a notification. Reference in this regard may be made to Wallace Flour Mills v. C.C.E., 1989 (44) E.L.T. 598 (S.C.) and C.C.E. v. Vazir Sultan Tobacco, 1996 (83) E.L.T. 3 (S.C.). The manufacturers who supplied the ingots to the appellants produced those ingots from old aluminium scrap got from open market and the scrap given by the appellants while manufacturing the castings. Once it is seen that the ingots were produced out of duty-paid old aluminium scrap, the ingot and the casting made out of it are coming within the purview of Notification No. 43/75. 7. By Notification No. 43/75, dated 1-3-1975, Central Government exempted aluminium of the description specified in column 3 of the table from so much of the duty of ....
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....ases where rice bran oil is directly used in the factory and to exclude cases where soap is manufactured by using rice bran fatty acid derived from rice bran oil, the use of rice bran fatty acid must also come within the purview of the notification. Their Lordships observed : "The whole purpose and object of the notification is to encourage the utilisation of rice bran oil in the process of manufacture of soap in preference to various other kinds of oil (mainly edible oils) used in such manufacture and this should not be defeated by an unduly interpretation of the language of the notification even when it is clear that rice bran oil can be used for manufacture of soap only after its conversion into fatty acid or hydrogenated oil." Similarly, in this case old aluminium scrap cannot by itself be the raw material for the manufacture of castings. Old aluminium scrap will have to be first made into ingots. These ingots can alone go into the manufacture of castings. The fact that old aluminium scrap was converted into ingots by some manufacturer from whom the appellant got it for the manufacture of castings cannot deprive the appellant of the benefit of this notification. 9.Virtual....