1996 (7) TMI 406 - AT - Central Excise

Summary

Issues:
1. Dispute over the marketability of Calcium Carbide for excise duty.
2. Challenge to the valuation of Calcium Carbide for excise duty.
3. Preliminary contention regarding the timing of the review notice.
4. Pending Special Writ Petition before the Supreme Court.
5. Determination of marketability of Calcium Carbide for excise duty.

Analysis:

1. The dispute in this case revolves around the marketability of Calcium Carbide for excise duty purposes. The appellant produced Calcium Carbide in the course of manufacturing Acetylene Gas, which was further used in making PVC Resin. The Department required the appellant to submit a price list for the Calcium Carbide, which was done under protest as the appellant contended that the product had no marketability and hence was not excisable goods. Previous disputes on this issue had been decided against the appellant, leading to the current appeal challenging the excisability of Calcium Carbide.

2. The valuation of the Calcium Carbide was also contested during the appeal process. The Assistant Collector and Collector (Appeals) initially deemed the product excisable and directed a fresh price list based on comparable goods. However, the Collector (Appeals) later set aside this direction, prompting the Department to challenge the decision, arguing that the valuation should be based on comparable goods.

3. A preliminary contention raised by the respondent questioned the timing of the review notice issued by the Government of India after a decision by the Delhi High Court that the Calcium Carbide produced by the respondent was not marketable and hence not excisable. This contention was a key aspect of the appeal process.

4. The appellant pointed out the existence of a pending Special Writ Petition before the Supreme Court against the decision of the Delhi High Court, indicating that the matter was still under consideration by a higher court. Despite this, the Tribunal decided to proceed with the appeals at hand, emphasizing that the pendency of a Special Leave Petition (SLP) did not necessitate a stay on the ongoing proceedings.

5. The central issue of determining the marketability of Calcium Carbide for excise duty was crucial to the final decision. While the Department argued that the product was marketable and thus excisable, citing its inclusion in the Tariff list, the High Court of Delhi highlighted the restrictions imposed by the Carbide of Calcium Rules, 1937, which governed activities related to Calcium Carbide. The High Court held that the Calcium Carbide produced by the respondent did not meet the purity standards set by the Rules, rendering it non-marketable. The Tribunal concurred with the High Court's interpretation, ultimately dismissing the appeal based on the finding that the Calcium Carbide in question was not excisable goods.