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TMI Blog2018 (8) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... ess of conversion of spent platinum catalyst into regenerated platinum catalyst cannot be considered as a process resulting in emergence of a new product having a different name, character or use - demand set aside. Conversion of pure platinum to colloidal platinum catalyst - Held that:- The appellants have converted metallic platinum into colloidal platinum for which there is a separate entry in Chapter Heading 28.4300 as “colloidal precious metals” of the Central Excise Tariff Act. It is but obvious that the metallic platinum by itself cannot be used for the purpose, as desired by MDPL, for which obviously only colloidal platinum will do the job as the catalyst of choice. The name, character and use of the raw material (metallic platinum) thus, changes by its emergence into colloidal platinum. In the event, the process is definitely one amounting to manufacture for the purpose of Section 2(f) of the Act - process amounts to manufacture - demand upheld. Whether M/s. MDPL, in whose premises the colloidal platinum catalyst and regenerated platinum catalyst are alleged to be manufactured are liable for any penalty under Rule 209A of the Central Excise Rules, 1944 - Held that:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was only a job worker entrusted with the activity as per agreement entered into with MDPL. Ld. Counsel took us to pages 105 and 106 of the typed set to highlight the write-ups on the catalyst regeneration as submitted to the Superintendent of Central Excise, Ld. Counsel contends that these two write-ups by MDPL and CIL were not disputed by the lower authorities. 2.2 As per the write up, the spent colloidal platinum is supplied by MDPL for regeneration and activation; that the spent colloidal is regenerated by series of chemical acid treatments. That the catalyst is boiled in hydrochloric acid and subsequently with nitric acid and thereafter mixed with chemicals like hydrazine hydrate, gum accasia, sodium carbonate etc. to make it activated colloidal platinum catalyst. That whenever MDPL gives fresh platinum, it is added to such treatment stage. 2.3 Hence no separate process has been done to convert platinum into CPC. CPC is nothing but platinum, does not have any different chemical properties and is not distinct from the platinum metal. 2.4 Admittedly, the catalyst is only platinum and not colloidal platinum since the latter is only a dispersion of platinum metal in a liqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocesses carried out by the appellant, namely : (i) Regeneration of platinum catalyst from spent platinum catalyst: The demand for this activity is proposed in Annexure A(1) to the Show Cause Notice for the period 12.06.1987 to 15.03.1989, the duty in dispute being ₹ 3,61,754.34/- (ii) Process of making colloidal platinum catalyst from pure platinum: The demand on this activity is proposed in Annexure A(2) of the Show Cause Notice for the period 12.06.1987 to 15.03.1989 and 16.03.1989 to 31.12.1989, the disputed duty being ₹ 11,53,302.39/-. 5.2 These disputed issues have been capsulated by the adjudicating authority in para 12 of the order dt. 31.07.2003 as under: (i) Whether in the facts and circumstances of the case excisable goods viz. colloidal platinum catalyst from platinum and also regenerated platinum catalyst from spent platinum catalyst amounts to manufacture. (ii) If so, who is the manufacturer of the impugned goods, i.e. M/s. CIL or M/s. MDPL. (iii) Whether the extended period under proviso to Section 11A of Central Excise Act, 1944 is invokable to demand duty in the facts and circumstances of the case. (iv) Whether M/s. MDPL, in whose pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. In Commissioner of Central Excise Vs. Osnar Chemical Pvt. Ltd. - 2012 (276) E.L.T. 162 (S.C.), the Hon ble Apex Court held as under : 19. We may now examine whether the process in question, otherwise amounts to manufacture under the expansive Section 2(f) of the Act. It is trite to state that manufacture can be said to have taken place only when there is transformation of raw materials into a new and different article having a different identity, characteristic and use. It is well settled that mere improvement in quality does not amount to manufacture. It is only when the change or a series of changes take the commodity to a point where commercially it can no longer be regarded as the original commodity but is instead recognized as a new and distinct article that manufacture can be said to have taken place. In this behalf the following observations by the Constitution Bench of this Court in Tungabhadra Industries (supra) are quite apposite : In our opinion, the learned Judges of the High Court laid an undue emphasis on the addition by way of the absorption of the hydrogen atoms in the process of hardening and on the consequent inter-molecular changes in the oil. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent from the characteristics of the tissue paper in the form of table napkin, toilet roll and facial tissue. In the present case, the Tribunal was right in holding that the characteristics of the tissue paper in the jumbo roll are not different from the characteristics of the tissue paper, after slitting and cutting, in the table napkins, in the toilet rolls and in the facial tissues. (Emphasis supplied by us) 22. In Deputy Commissioner Sales Tax (Law), Board of Revenue (Taxes), Ernakulam v. Pio Food Packers, 1980 (6) E.L.T. 343 (S.C.), a three Judge Bench of this Court, while deciding whether conversion of pineapple fruit into pineapple slices for sale in sealed cans amounted to manufacture, observed as follows :- 4 Commonly, manufacture is the end result of one or more processes through which the original commodity is made to pass. The nature and extent of processing may vary from one case to another, and indeed there may be several stages of processing and perhaps a different kind of processing at each stage. With each process suffered, the original commodity experiences a change. But it is only when the change, or a series of changes, take the commodity to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise Tariff Act. It is but obvious that the metallic platinum by itself cannot be used for the purpose, as desired by MDPL, for which obviously only colloidal platinum will do the job as the catalyst of choice. The name, character and use of the raw material (metallic platinum) thus, changes by its emergence into colloidal platinum. In the event, the process is definitely one amounting to manufacture for the purpose of Section 2(f) of the Act. 6.3 We also take note that the appellant has given different processes of manufacture of the subject goods before the Original Adjudicating Authority and before the lower appellate authority as the fact which has been highlighted in the impugned order. 6.4 In the event, the duty demand of ₹ 11,53,302.39/-, with interest, on the process of converting platinum into colloidal platinum catalyst proposed in Annexure A(2) of the Show Cause Notice, confirmed by the Original Authority and upheld by the Commissioner (Appeals) does not call for any interference. 7. Penalties imposed on CIL and MDPL are set aside since the disputes revolve around interpretations on whether the processes concerned amount to manufacturing or other ..... X X X X Extracts X X X X X X X X Extracts X X X X
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