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TMI Blog2015 (10) TMI 1558X X X X Extracts X X X X X X X X Extracts X X X X ..... together and are disposed of by a common order. 2. The facts of the case are that the appellant is engaged in the manufacture of lead, zinc and sulphuric acid which are subject of excise duty. During the manufacture of those products, toxic effluent 'Jarosite' is generated. As per pollution control norms, the appellant is treating the said jarosite with cement and lime before discharging the said treated effluent as secured land fill. During the period in dispute, the appellant availed cenvat credit on the cement used for treating the effluent jarosite before dumping it in the land fill. The Revenue is of the view that since exclusive use of cement was to treat the effluent and it was not used in connection with the manufacture of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Tribunal held that ammonia was used for the maintenance of the plant and equipment meant for testing and commissioning the plant and could not be said to be utilised in manufacture. Similarly, the purpose of the water treatment being essential for the protection of the boiler and other process equipment from corrosion, formation of scales, etc., the ammonia used for the purpose could not be said to be used in the manufacture of fertilisers. The view of the Collector, insofar as the effluent treatment plant was concerned, was upheld. 8. For our conclusion we draw support from the judgment of this Court in Collector of Central Excise, Calcutta-II v. Eastend Paper Industries Ltd.-1989 (43) E.L.T. 201 = 1989 (4) SCC 244 , where it was hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... served that, correctly apprehended, that statement did not lend itself to the understanding that for something to qualify itself as a raw material it had necessarily and in all cases to go into and he found in the end-product. The court also quoted with approval the case of Eastend Paper Industries Limited cited above. 9. That leaves us to consider whether the raw naphtha used to produce the ammonia which is used in the effluent treatment plant is eligible for the said exemption. It is too late in the day to take the view that the treatment of effluents from a plant is not an essential and integral part of the process of manufacture in the plant. The emphasis that has rightly been laid in recent years upon the environment and pollution co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yed in off-site plants, namely, water treatment plant, steam generation plant, inert gas generation plant and effluent treatment plant, all of which were part of the integral process of the manufacture of urea. After taking into consideration the earlier judgment in the case of C.C.E., Calcutta-II v. M/s. Eastend Paper Industries Ltd. AIR 1990 SC 1893, J.K. Cotton Spinning and Weaving Mills Co. Ltd. v. Sales Tax Officer, Kanpur, AIR 1965 SC 1310, C.C.E., New Delhi v. M/s. Ballarpur Industries Ltd- 1989 (43) E.L.T. 804 (S.C.) - AIR 1990 S.C. 196 and Deputy CST v. Thomas Stephen & Co. Ltd., 1988 (34) E.L.T, 412 (S.C) - AIR 1988 S.C. 997 in paragraph 9, the Supreme Court held as follows: "9. That leaves us to consider whether the raw naphtha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent plant at their unit. Without installing effluent treatment plant and treating the gases effluents which emerges during the manufacture of these chemicals, the manufacturing process cannot take place. Therefore, treatment of gases effluents is essential part of manufacturing of these chemicals. As appellant has used sulphuric acid as input for treatment of these gases effluents in the effluent treatment plant, which is a process of manufacturing of final product (directly or indirectly), therefore, same is entitled for input credit as per Rule 2(K) of the CENVAT Credit Rules, 2004. Therefore, the appellant has rightly taken the input credit on sulphuric acid for treatment of effluents arising during the manufacture of final product." 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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