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TMI Blog1984 (10) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... s and magnetite under Item 68 of the C.E.T. The Appellants in their letter dated 19th April, 1979, intimated the Assistant Collector, Central Excise, Jamshedpur that these items were not dutiable under Item 68 of the C.E.T. and that they were stopping payment of duty and would arrange for claiming the refund separately. The Excise authorities, however, did not accept this contention of the appellants company and held that there was a distinct change in character of the concentrates found from the ore and so the same attract Tariff Item 68 on manufacture. 3. Not satisfied with the said order of the Assistant Collector, Central Excise, Jamshedpur, appellants company preferred an appeal on 23-8-1979 contending inter alia that the recovery of copper, molybdenite concentrate and magnetite minerals from the uranium ore did not involve any manufacturing operation as understood and contemplated in the Excise Law. It was also mentioned that the copper minerals as upgraded was sold to M/s. Hindustan Copper Limited, the only concern having necessary facilities to make copper metal. The said company was in due course paying excise duty as payable on the copper metal produced including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods as liable to excise duty. 7. The well-settled fact and law would thus appear to be that a mere processing would not amount to manufacture as understood in the excise law. The process adopted by the appellants company to upgrade the copper, molybdenum and magnetite minerals from the very low percentage to high percentage to market the product cannot, in view of the clear judicial pronouncement be treated as manufacture and levy of excise duty on these products is thus not justified. No manufacturing process is involved in conversion of copper ores to copper concentrates. Copper ore concentrate is still copper ore and there is no change in the chemical composition of the basic ore. The essence of the term manufacture is changing of one object into another for the purpose of making it marketable. The definition of the term manufacture as per Section 2(f) of the Central Excises and Salt Act, 1944 would broadly imply a change in the raw materials and also something more viz. there must be such a transformation of a product (raw material) that a new and different article must emerge having a distinct name, character or use. In the case of copper mineral concentrates pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot the case of the appellants company that the copper concentrate is removed under Rule 56B of the Central Excise Rules, 1944. They are selling the copper concentrate in question to M/s. Hindustan Copper Limited and as such it is a marketable commodity and therefore subject to excise levy under Item 68 C.E.T. The concentrate of copper, admittedly, contains 25% of copper and the ore from which such concentrate is obtained by chemical process, contains about 1 to 2 per cent of copper. So, the copper content of the copper concentrate and ore differs substantially, apart from the other ingredients contained in the original ore and in the copper concentrate obtained from the ore. On the basis of these facts, Shri Khanna submitted that copper concentrate and the ore from which such concentrates are obtained are not identical materials in all respects and, therefore, copper concentrates are subject to excise levy under Item 68 of Central Excise Tariff. 9. As far as the facts are concerned, there is no dispute that the appellants are producing copper concentrates from the ores obtained from the mines owned by them. There is also no dispute that uraninm ore mined contains a small percent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch it is made, and that this difference qualifies it for assessment under Item 68, but I have failed. I will take the Appellate Collector s order for the purpose of this discussion as it contains more details than the Assistant Collector s order. 12. The Appellate Collector says that the Uranium Corporation submitted that it obtained the concentrate by grinding and washing the ore, removing most of the gangue thus producing a concentration of 25% copper. He said that the contention of the party that this process did not produce a marketable commodity appeared to have some force as copper (ore) concentrate was an intermediate semi-finished product in the ultimate process of extraction of copper. But he found fault with the factory because the copper concentrate did not move under Rule 56B of Central Excise Rules, 1944. This is totally irrelevant. Rather surprisingly, the Appellate Collector declared further down that the concentrate had been obtained by chemical process. I am not able to determine how he received this information. 13. A concentrate is obtained by a mechanical process of removing the non-copper gangue material. I am not aware of a chemical process by which this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed, the concentrate is nothing but the ore, though with a higher content of metal. Even unconcentrated, the ore is sold, just like the concentrate. The latter commends a better price, but the marketability is not a bit different. The difference, if there is one, is only the difference between the customer appeal of a better or superior product and an inferior one. The DCM judgment is true for a case when a heading looms before a commodity for purposes of excisability under the Central Excise Tariff; it is not true for the purpose of saying that something, no matter what has been done to it, ceases to be that thing and it should pay excise, and if there is no specific heading for it, it should be excised under Item 68, the residuary, non-specific item. The judgment is not to enable us to say, This thing has undergone some process, therefore, it is no longer what it was before the process . It is meant to be a test for determining if something has appeared for the purpose of excise. 16. I am of the opinion that the concentrate has not acquired excise liability. It remains what it was a copper ore. That it has a market is a merit it shares with its source, the (unconcentrated) o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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