1981 (7) TMI 235 - Commissioner - Central Excise

Summary

Issues: Eligibility for concessional rate of duty on Copper and Copper Alloys Sheets and circles manufactured with Zinc admixture under Notification No. 119/66.

The judgment involves the appeal by M/s. K.R. Metal Industries challenging the duty rate imposed by the Superintendent of Central Excise, Range No. II, Bombay Div. 'R'. The issue revolves around whether the appellants are entitled to the concessional rate of duty of Rs. 700/- P.M.T. on their products, Copper and Copper Alloys Sheets and circles, despite admixturing Zinc in the manufacturing process. The appellants argue that they manufacture these products out of Brass Slabs, which are produced from old scrap or duty paid Copper with Zinc admixture, as a technological necessity. They claim that they have made full declarations, including the Zinc addition, and received approval for the duty rate. Additionally, they cite a government clarification limiting duty liability to the Copper content in Alloys if the Copper content has paid duty, even if other metals like Zinc are added. The appellants also refer to previous Appellate Orders exempting Copper Alloys in crude form from duty when manufactured from old scrap with Zinc admixture. They request to set aside the impugned order based on these arguments.

The Collector of Central Excise (Appeals) examines the case records and contentions. The Superintendent had demanded duty from the appellants, citing that they were not entitled to exemption under Notification No. 119/66 due to the Zinc addition in Brass Slabs manufacturing. However, a previous Appellate Order concluded that the appellants were eligible for exemption even with Zinc admixture. This decision was upheld by the Central Government upon review, emphasizing that the Notification does not require the materials to be used exclusively or entirely for the concession. The Government also refers to a Supreme Court judgment stating that exemptions do not necessitate exclusive use of specified materials. Consequently, the Collector sets aside the impugned orders and allows all 15 appeals, ruling in favor of the appellants.