9911796707
TMI Blog1984 (10) TMI 231X X X X Extracts X X X X X X X X Extracts X X X X ..... ct to this Tribunal to be disposed of as if it were an appeal filed before the Tribunal. 2. The facts of the case, briefly stated, are that M/s. Neyveli Lignite Corporation Ltd., the appellants (hereinafter referred to for brevity s sake as N.L.C.) received a quantity of 4451.716 K.L. of furnace oil during the period from March, 1979 to 15-7-1979 without payment of Excise duty under Chapter X Procedure to be used as feed-stock in the manufacture of fertilizer in accordance with Central Excises Notification No. 147/74, dated 30-10-1974. The actual manufacture of fertilizer (urea) commenced only from 16-7-1979. Till this date the furnace oil obtained in terms of the aforesaid notification was used for stabilisation and test-run of the oil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioning of the plant would be raw-naphtha intended for the use in the manufacture of fertilizer. Whether it was used wholly as feed-stock or partly as feed-stock and partly as processed fuel, the concessional rate of duty would be available in such cases. The Assistant Collector who adjudicated the case did not accept N.L.C s contentions. He held that Notification No. 147/74 did not apply in the instant case but Notification No. 195/76 in terms of which duty at ₹ 61.05 per K.L. was chargeable on furnace oil used otherwise than as feed-stock in the manufacture of fertilizer. The Assistant Collector, considered that the analogy of the Government s instructions regarding raw-naphtha was not applicable to the present case. In view of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the gas from the oil gasification process also for urea production. Accordingly, it is stated, a quantity of 2085 metric tonnes urea would be relatable to oil as feed-stock during the period from 4-7-1979 to 15-7-1979, though in the relevant excise records the urea production entries were made from 16-7-1979 the date from which the fertilizer factory was run solely on furnace oil as feed-stock. It is averred that the aforesaid quantity of furnace oil was not used as fuel but was used only as feed-stock in the manufacture of fertilizer. 5. We have heard Shri V.N.R. Rao, Senior Advocate with Shri S. Raghunathan Technical Manager for the appellants and Shri S.N. Khanna, Departmental Representative for the respondent. 6. Shri Rao elabor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification 147/74. Notification 187/61 regarding raw-naphtha was not analogous and the Ministry s clarification relied upon by the counsel for N.L.C. was not applicable since the notification there was different. Regarding Board s order-in-appeal relied upon by the counsel Shri Khanna stated that the notification would prevail over the said decision. 8. We have carefully considered the submissions of both sides. It is necessary to ascertain the meaning of the expression feed-stock for the purpose of arriving at a proper decision in the present case. The following are taken from dictionaries- Feed-Stock - Raw material supplied to machine etc. (The Concise Oxford Dictionary, New Seventh Edition.) The raw material furnished to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hine in the fertilizer plant. From the process flowsheet for fuel oil based urea production by N.L.C., a copy of which was furnished by Shri Rao during the hearing, it is clear that furnace oil has to go through the stages of gasification, desulphurisation and decarbonation and certain other processes before ammonia is generated ultimately leading to the production of urea. 9. Notification No. 147/74, dated 30-10-1974 reads as follows :- The Central Government has exempted furnace, oil falling respectively under Item No. 10 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944) and intended for use as feed-stock in the manufacture of fertilizers, from- (a) the whole of the duty of excise leviable thereon; and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... furnace oil, falling under Item No. 10 of the First Schedule to the Central Excises and Salt Act, 1944 (1 of 1944) and intended for use, otherwise than as feed-stock in the manufacture of fertilizers, from so much of the duty of excise as is in excess of ₹ 61.05 per kilolitre : Provided that- (i) it is proved to the satisfaction of the Assistant Collector of Central Excise that such furnace oil is so used, and (ii) the procedures set out in Chapter X of the Central Excise Rules, 1944, is followed. [vide M.F. (D.R.B.) Notification No. 195/76-C.E., dated 10th June, 1976.] This notification applies in the case of furnace oil intended for use otherwise than as feed-stock in the manufacture of fertilizer. We have seen that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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