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TMI Blog2011 (6) TMI 521X X X X Extracts X X X X X X X X Extracts X X X X ..... f excisable goods, namely, G.P. Coils, G.P. Sheets, G.C. Sheets, C.R. Sheets and C.R. Coils, falling under Chapter heading No.72 of the Central Excise Tariff Act, 1985. During the course of galvanization, waste product, zinc dross emerges and the appellants sell the same without payment of Central Excise duty. Prior to April 2005, the appellants were classifying Zinc Dross under chapter sub heading No. 7902.00 and were clearing the same on payment of Central Excise duty. However, they stopped payment of Central Excise duty on the said product in view of the hon'ble Supreme Court's judgement in the case of CCE, Patna Vs.Tata Iron & Steel Co. Ltd., reported in 2004 (165) ELT 386 (SC) wherein it was held that Zinc dross is not a ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Commissioner of Central Excise, Raigad. 3. The Ld. Counsel for the appellant submits that prior to the amendment of Central Excise Act vide Finance Act, 2008, zinc dross was not considered to be a manufactured item, even though zinc dross was specified in the Central Excise Tariff. He relies on the judgement of this Tribunal in the case of Vishal Pipes Vs. CCE, Noida, reported in 2010 (255) ELT 532 (Tri-Del), wherein it was held that the process of generation of zinc ash, dross and other residues does not involve any manufacturing process and the goods cannot be said to be excisable. The amendment made in March 2005 to the Central Excise Tariff wherein a specific heading was created for zinc dross under sub heading No.7200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Advocate also relies on the Circular No.904/24/2009-CX dated 28/10/2009 issued by the CBE&C, New Delhi, wherein it was, inter alia, clarified as follows: "References have been received from field formations on the issue of excisability of Bagasse and Aluminium/Zinc Dross. 2.?The matter has been examined. Excisability of bagasse and similar waste products arising during the course of manufacture has been under dispute for a long period of time. There are number of Tribunal's judgments that being waste, these are not excisable products. Departmental appeal in respect of excisability of bagasse in one such case i.e. Balrampur Chinni Mills Ltd. is reportedly still pending in the Supreme Court. Ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oils cannot be considered to be excisable commodities and, therefore, the demand confirmed vide the impugned order is unsustainable and bad in law. 4. The Ld. DR appearing for the department reiterates the findings given in the impugned order. He places reliance on the judgement of the apex Court in the case of Commissioner of Income Tax, Kerala Vs. Tara Agencies, reported in 2007 (214) ELT 491 (SC) wherein it has been held the word production/produce includes in its scope bringing into existence new goods by a process which may or may not amount to manufacture and also takes in all the by-products, intermediate products and residual products which emerge in the course of manufacture of goods. Therefore, the zinc dross ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submits that the zinc dross arising in the process of galvanization of G.R. Sheets/Coils is a manufactured and excisable commodity and liable to excise duty. 5. We have carefully considered the rival submissions. 5.1 There is no dispute or doubt about the fact that zinc dross is an item specified in the Central Excise Tariff. Merely because an item is specified in the tariff chargeable to a rate of duty, it cannot be concluded that they are excisable goods, i.e., they are manufactured and marketable goods. As has been held by this Tribunal in the case of Vishal Pipes Vs. CCE, Noida, cited supra, there is no legal fiction of 'manufacture' by way of a chapter note to treat the impugned goods as manufactured items. Further, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clarified that only after amendment in Section 2 (d) of the Central Excise Act, 1944 wherein an explanation was added clarifying that 'goods' include any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable, products like zinc dross and skimmings can be held to be excisable and marketable. Prior to the amendment to section 2 (d) effective from May 2008, the circular makes it absolutely clear that these products cannot be treated as excisable goods even though they might find specific entry in the Excise Tariff and even though they may fetch some price in the market. 6. In the light of the Board's Circular cited suprfa and as also in the light of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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