1993 (10) TMI 184 - AT - Central Excise

Summary

Issues:
1. Amendment of facts in the case
2. Stay of operation of Order-in-Appeal
3. Classification of spent acid as input for Modvat Credit

Analysis:
1. The Collector of Central Excise filed a Miscellaneous Application seeking amendment of facts related to the Order-in-Original set aside by the Collector of Central Excise (Appeals) and sought restoration of the same in the appeal before the Tribunal. The Stay Petition filed by the Collector sought a stay of the operation of the impugned Order-in-Appeal. The Tribunal allowed the Miscellaneous Application. Shri B.B. Sarkar represented the Collector, while no representation was made by the Respondents. The Stay Petition was disposed of after hearing Shri Sarkar.

2. The Stay Petition aimed to stay the operation of the Order-in-Appeal passed by the Collector of Central Excise (Appeals) in favor of the Respondents, M/s. Piyush Chemicals & Pharmaceuticals Pvt. Ltd. The Collector allowed the Respondents' Appeal, considering their declaration of Sulphuric Acid as input under Rule 57G for Modvat Credit. The Collector held that spent sulphuric acid was only sulphuric acid, supported by the Superintendent's confirmation. The Collector's decision was challenged in the Appeal, seeking a stay of operation.

3. The Departmental Representative argued in support of the Stay Petition, contending that the Collector erred in equating sulphuric acid with spent acid. Reference was made to a Tribunal decision distinguishing spent acid from sulphuric acid based on their chemical properties. The Tribunal decision held that Modvat Credit should also apply to the quantity of spent acid, not just the consumed quantity in the manufacturing process. However, in the current case, the spent acid was classified under Heading 2807.00, not 38.23 as in the Tribunal decision. The Tribunal decision was deemed inapplicable as it postdated the assessment of inputs. Since the spent acid had paid duty under Heading 2807.00, the Rule 57G declaration by the recipient manufacturer was considered adequate. Consequently, the Tribunal rejected the Stay application, indicating that the inputs had already been classified and duty paid appropriately.

In conclusion, the Tribunal rejected the Stay application, emphasizing that the spent sulphuric acid had already been classified and duty paid under the relevant heading. The decision highlighted the importance of the classification of inputs for Modvat Credit eligibility and clarified the distinction between spent acid and commercial sulphuric acid. The judgment provided a detailed analysis of the legal principles governing the classification of inputs for excise duty purposes and the application of Modvat Credit.