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TMI Blog2015 (9) TMI 1024X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 - CESTAT, NEW DELHI) by dismissing the civil appeal filed against the Tribunal's judgment would be a binding precedent ". Matter referred to larger bench. - Excise Appeal No. 653 of 2012 with Misc. Application No. 51861 of 2014 , Excise Appeal No. 3585 of 2012 - Misc. Order No. MO/51808/2015-EX(DB) - Dated:- 14-5-2015 - Rakesh Kumar, Member (T) And Sulekha Beevi C S, Member (J) ,JJ. For the Appellant : Shri B L Narasimhan, Adv. For the Respondent : Shri R K Gupta, AR (DR) ORDER Per: Rakesh Kumar: The facts leading to filing of appeals are in brief as under. 1. The appellants in both the cases manufacture refined vegetable oil. In course of refining of crude vegetable oil, fatty acids, wax and gum emerge as by-products. The refined vegetable oil did not attract any duty, as during the period of dispute, either the refined vegetable oils were fully exempt from duty under Notification No. 3/06-CE dated 01/3/06 or the tariff rate itself was nil. The exemption Notification No. 89/95-CE dated 18/5/95 exempts the waste, parings and scrap arising in course of manufacture of exempted goods and falling within the schedule to the Central Excise Tariff Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these appeals have been filed. 2. Heard both the sides. 3. Shri B.L. Narasirnhan, Advocate, the learned Counsel for the appellant, pleaded that though the Tribunal in the case of CCE, Jalandhar vs. A.G. Fats Ltd. reported in 2012 (277) E.L.T. 96 (Tri. - Del.) had held that Fatty Acids oil, wax and gum emerging as by-product in course of manufacture of refined vegetable oil from crude vegetable oil are not waste and not exempted under Notification No. 19/95-CE and this judgment of the Tribunal has been affirmed by the Apex court by the way of dismissal of civil appeal vide order dated 02/1/12 reported in 2014 (300) E.L.T. A74 (S.C.) , the Bombay Bench of the Tribunal in the case of Maheshwari Solvent Extraction Ltd. vs. CCE, Nagpur reported in 2014 (299) E.L.T. 116 (Tri. -Mumbai) has taken a contrary view holding that the fatty acids, wax and gum emerging in course of refining of crude vegetable oil are in the nature of waste and would be eligible for exemption under Notification No. 89/95-CE, and in this judgment, the Tribunal has also considered the coordinate Bench's judgment in the case of CCE, Jalandhar vs. A.G. Fats Ltd. (supra) and also the fact that the civil appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eries Ltd. (supra) where a contrary view had been taken, had been dismissed. He pleaded that in view of these circumstances, it is the Apex court's judgment in the case of CCE, Jalandhar vs. A.G. Fats Ltd. (supra) which would be a binding precedent and therefore, the Tribunal was not correct in taking a different view in the case of Maheshwari Solvent Extraction Ltd. vs. CCE, Nagpur (supra) . He, therefore, pleaded that there is no infirmity in the impugned order. However, he has no objection if the matter referred to Larger Bench. 5. We have considered the submissions from both the sides and perused the records. 6. The appellant manufacture refined vegetable oil by processing of crude oil and in course of refining of crude vegetable oils, Fatty acids, wax and gums emerge as unavoidable by-products. During the period of dispute, the refined vegetable oil was either fully exempt from duty under same exemption Notification or was chargeable to nil rate of duty in the tariff itself and as such was to be treated as exempted goods for the purpose of Notification No. 89/95-CE dated 18/5/95. The only point of dispute is as to whether for the purpose of this exemption notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facturer intends to manufacture. The by-product may be in the nature of refuge, of no or little value and fit to be discarded or may be a commercially known product, which has same commercial value, which is worthwhile to be marketed and hence is a marketable product. In the former case, when the by-product being of no or little commercial value is fit to be discarded, would be waste, but in the latter case, when the by-product, even though an unintended product, is of commercial value and is a marketable product, it would be absolutely incorrect to categorize it as a waste just because it is an unintended product emerging in the courses of a product which the manufacturer intended to manufacture. In the former case, when the by-product is waste fit to be discarded and for which there is no regular market, the same would be non-excisable, while in the latter case, where the by-product is marketable, the same would be excisable if it is covered by seme heading/sub-heading of Central Excise Tariff for levy of excise duty. Just because the Government, as per its understanding of the word 'waste' has issued the exemption Notification No. 89/95-CE exempting the waste arising as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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