1985 (10) TMI 193 - AT - Central Excise

Summary

Issues:
- Disallowance of benefit under Notification No. 201/79 for certain items by the Assistant Collector of Central Excise.
- Appeal to the Collector of Central Excise (Appeals) against the disallowance.
- Dispute over whether certain items qualify as raw materials for the manufacture of paper.
- Appeal to the Appellate Tribunal CEGAT, Madras against the orders of the Collector of Central Excise (Appeals).
- Argument regarding the eligibility of burnt lime for the benefit of Notification No. 201/79.

Analysis:
The judgment involves two appeals arising from a single order of the Assistant Collector of Central Excise disallowing the benefit of Notification No. 201/79 for various items used in the manufacture of paper. The Collector of Central Excise (Appeals) upheld the decision, stating that though the items are used in paper manufacture, they do not constitute raw materials for paper production. However, the appellants argued for the benefit based on previous Tribunal decisions recognizing some of the items as raw materials. The Tribunal considered the arguments and past decisions to determine the eligibility of each item.

In the case of Alumina Ferric, Sodium Sulphate, China Clay, Glue Powder, Soap Stone Powder, Rosin, Acetic Acid, and Sulphamic Acid Powder, the Tribunal agreed with the appellants that these items qualify as raw materials for paper manufacture under Notification No. 201/79. Specifically, the Tribunal disagreed with the view that Sulphamic Acid Powder does not serve an essential purpose, recognizing its role in preventing fiber degradation in pulp. Therefore, these items were deemed eligible for the benefit of the notification.

Regarding Burnt Lime, the Senior Departmental Representative argued against its eligibility, citing its use in processes other than paper manufacture. The Tribunal referred to previous decisions and observations, concluding that Burnt Lime does not qualify as a raw material for paper production under the notification. The Tribunal upheld the Collector of Central Excise (Appeals) decision on Burnt Lime and dismissed the appeal related to it.

The judgment emphasizes the importance of considering each item's role in the manufacturing process and its essentiality for the final product when determining eligibility for benefits under relevant notifications. The Tribunal's decision was based on a thorough analysis of the arguments presented by both parties and previous rulings on similar matters, ensuring consistency and clarity in the application of the law.