1998 (7) TMI 158 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notification No. 7/65-C.E. dated 30th January 1965 regarding exemption of dry ice from duty under Tariff Item 14H.
2. Determination of whether the use of dry ice for preservation of meat during transportation qualifies for industrial use under the said notification.

Analysis:
1. The case revolved around the interpretation of Notification No. 7/65-C.E. dated 30th January 1965, which exempted dry ice from duty under Tariff Item 14H if used for industrial purposes. The Revenue alleged that dry ice used by the respondents for meat preservation during transportation did not qualify for this exemption. The argument presented was that dry ice, solidified CO2 gas, was different from carbonic acid mentioned in the notification, and hence, the exemption did not apply to dry ice. The Collector's failure to consider this distinction was a key point raised by the Central Board of Excise and Customs (CBEC) in their appeal.

2. The CBEC further contended that even if the notification applied to dry ice, the use of CO2 gas for food preservation during transportation could not be considered industrial use, thereby disqualifying it from the exemption. However, the Appellate Tribunal disagreed with this argument. The Tribunal noted that the respondents were engaged in the manufacturing and selling of meat and meat products, which constituted a business activity requiring the transportation and sale of their products. As such, the Tribunal interpreted the term "industrial use" in the notification to encompass activities related to marketing and selling products. Therefore, the Tribunal held that the respondents were entitled to the benefit of the notification for using dry ice in preserving meat during transportation and sale, ultimately dismissing the Revenue's appeal.

In conclusion, the Appellate Tribunal upheld the decision of the adjudicating authority, ruling in favor of the respondents and dismissing the Revenue's appeal. The Tribunal clarified the scope of "industrial use" under Notification No. 7/65-C.E. and emphasized that activities related to marketing and selling products could be considered within the ambit of industrial use.