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TMI Blog2014 (9) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... repeatedly in the manufacture of Sulphuric Acid only. He also observed that Sulphuric Acid remains Sulphuric Acid at both intermediate and final stages, thereby, falling under the same Chapter Sub-Heading - Following decision of Ambalal Sarabhai Enterprise[1989 (8) TMI 72 - SUPREME Court], United Phosphorous [2000 (4) TMI 38 - SUPREME COURT OF INDIA], Bhor Industries [1989 (1) TMI 128 - SUPREME COURT OF INDIA] and Moti Laminates [1995 (2) TMI 67 - SUPREME COURT OF INDIA] - Decided against Revenue. - APPEAL NO.E/A/600/2007 - ORDER NOFO/A/75450/2014 - Dated:- 5-6-2014 - DR. D.M.MISRA AND DR. I.P.LAL, JJ. FOR THE APPELLANT : SHRI S.MISRA, A.R.(ADDL. COMMR.) FOR THE RESPONDENT : DR. SAMIR CHARKABORTY, ADVOCATE JUDGEMENT Per Dr. D. M. Misra: This is an Appeal filed by the Revenue against the Order-in-Original No. 122-136/Commissioner/CE/KOL-IV/2007 dated 22.08.2007. 2. Briefly stated the facts of the case are that the Respondent are engaged in the manufacture of Viscose Rayon Filament Yarn falling under Chapter Sub-Heading 5403.32, Cellophane Films falling under Chapter Sub-Heading 3920.21, Surphuric Acid falling under Chapter Sub-Heading 2807.00 of Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods, and consequently, is liable to excise duty when cleared out of factory without payment of duty, availing benefit of exemption either under Notification No.5/99-CE dated 28.02.99 or under Notification No.6/2002-CE dated 01.03.2002, as the case may be, observing Chapter X Procedure for its use in the fertilizer units/plants. In support, he has referred to the judgment of the Honble Supreme Court in the case of Medley Pharmaceuticals Ltd. vs. CCE Cus., Daman 2011(263) ELT 641(SC). 5. The ld. Advocate, Dr. Samir Chakraborty appearing for the Respondent, submits that the ld. Adjudicating Authority, after detailed discussion on the process of manufacture, has categorically held that Sulphuric Acid (98% to 99% purity), which comes into existence in the Circulation Tank, i.e. at an intermediate stage, cannot be chargeable to duty, as there was no manufacture of any other Sulphuric Acid in a marketable condition. In support, he has referred to the judgment of the Honble Supreme Court, viz.,i) CCE vs. Ambalal Sarabhai Enterprise,1989(43)ELT 214(SC); ii) CCE vs. United Phosphorous Ltd., 2000(117)ELT 529; iii) Bhor Industries vs. CCE, 1989(40) ELT 280(SC; and iv) Moti Laminates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isting circulating intermediate Sulphuric Acid. As a result of the aforesaid, the gases get converted into liquid form and become a part of the pre-existing intermediate Sulphuric Acid in the tanks. The said gases keep on continuously increasing the concentration of circulating intermediate Sulphuric Acid in the Acid Circulation Tanks. Consequently and to keep the concentration to the required level, water is injected continuously. In the Acid Circulation Line, Acid Concentration Meter is installed which monitors and senses the acid strength and automatically adjusts the water addition rate. On attainment of the desired strength, the Sulphuric Acid is transferred, with the help of a valve, from Circulation Tank to the Final Storage Tank. Prior to removal to the Final Storage Tank the material is only at a continuous in-process stage. Sulphuric Acid at the plants of almost all other manufacturers is also manufactured in the same manner. It is only at the final stage that Sulphuric Acid of the required concentration is transferred to the Storage Tanks. The said circulating Acid is nothing else but an intermediate stage due to the acid continuously getting accumulated into Circulation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hur tri-oxide producing oleum which, in turn, on dilution with water or dilute Sulphuric Acid, regenerates Sulphuric Acid of 98-99%. Thus, that Sulphuric Acid which is not coming out of the plant is being automatically circulated for regeneration and further production of Sulphuric Acid in the closed chamber circuit. The circulation tank is not final stage of storage of Sulphuric Acid and it is a part of the total plant in the manufacturing process. The reported storage of any material in the circulating tank is in the nature of transient in - process material and not goods for Central Excise purposes. After completion of the manufacturing process on attaining of finality by double contact process in the manufacturing tank (including the circulation tank) the Sulphuric Acid so manufactured is removed with the help of a valve to the final storage tank from where no portion of Sulphuric Acid is used in the manufacturing system. In view of the above, until the Sulphuric Acid finally manufactured comes out after attaining its required strength, the Sulphuric Acid utilized in the manufacturing system in the double contact (double absorption) process in a continuous process is neith ..... X X X X Extracts X X X X X X X X Extracts X X X X
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