Admissibility of Modvat Credit on Sulphuric Acid used in the manufacture of detergent powder - Point No. 24 of 3rd North Zone Tariff Conference held in New Delhi in November, 1990 - regarding - Central Excise - 23/91-CX-8

Admissibility of Modvat Credit on Sulphuric Acid used in the manufacture of detergent powder - Point No. 24 of 3rd North Zone Tariff Conference held in New Delhi in November, 1990 - regarding Circular No. 23/91-CX-8 Dated 28-6-1991 [From F. No. 264/32/90-CX.8] Government of India Central Board of Excise Customs New Delhi Subject : Admissibility of Modvat Credit on Sulphuric Acid used in the manufacture of detergent powder - Point No. 24 of 3rd North Zone Tariff Conference held in New Delhi in November, 1990 - regarding I am directed to refer to the minutes on Point No. 24 of the 3rd North Zone Tariff-cum-General Conference held at New Delhi on 30-11-1990 and 1-12-1990 on the above subject suggesting review of Board's instructions F.No. 267/56/88-CX-8, dated 29-7-1988 . Vide the aforesaid instructions, Board had clarified that modvat credit should be restricted to the duty element on the concentrated sulphuric acid actually consumed in sulphonations reaction. This could be arrived at by deducting the duty equivalent of spent acid from the duty paid on concentrated sulphuric acid or oleum initially charged. 2. The matter has been re-examined by the Board in consultation with the Chief Chemist, Central Revenues, Control Laboratory, New Delhi. The Chief Chemist has opined that when the concentrated sulphuric acid is used in sulphonation the excess acid gets diluted is known as spent acid which can not be considered an altogether different product from sulphuric acid originally added. In the recent West Zone Tariff Conference held on 25th 26th March, 1991, the Conference has taken a view that in view of Note 1(b) to Chapter 28, even sulphuric acid (of less than 77% concentration) would be classified under Heading 2807. Hence spent acid, with impurities as permissible under HSN notes at page 228 would be classifiable under Heading 2807. 3. In view of the opinion of the Chief Chemist and deliberations in the West Zone Tariff Conference as brought out above Board has decided that ins- tructions F.No. 267/56/88-CX-8, dated 29-7-1988 (Circular No. 33/88) are correct need no review. 4. The above instructions may be brought to the notice of the field formations. Receipt of this letter may please be acknowledged.