Case Law Details
JSW Steel Limited Vs Commissioner of Central Excise (CESTAT Bangalore)
CESTAT Bangalore held that top gas is refuse like dross and skimmings which are merely scum thrown out in the manufacture of aluminium sheets and have been held not to be “manufactured” goods.
Facts- JSW Steel Limited is engaged in the manufacture of Hot Rolled Coils, Sheets, Plates and Direct Reduced Iron. The appellant claimed that it had become necessary to remove the impurities from the top gas which had emerged from the Reduction Shaft during the process of manufacture to ensure compliance with the directions issued by the Ministry of Environment and Forests. The top gas, according to the appellant, is refuse like dross and skimmings which are merely scum thrown out in the manufacture of aluminium sheets and have been held not to be “manufactured” goods. It is for this reason that the appellant believed that central excise duty could not have been levied on the export gas that emerged after the removal of impurities even if the export gas was supplied to Jindal Praxair Oxygen Company Pvt. Ltd. and JSW Energy Limited.
The demand has been confirmed by the orders impugned in these appeals holding that since the top gas that emerged from the Reduction Shaft had been subjected to a refining process for removal of impurities, the process had resulted in changes that made the resultant export gas marketable which indicates that it was ‘manufactured’, an essential factor for levy of central excise duty.
Conclusion- Held that top gas is refuse and has not been manufactured. Merely because impurities have to be removed to comply with the conditions set out in the letter granting permission to the appellant to ensure the protection of the environment, the refuse will not change its character and will continue to be refuse. It cannot be urged that a new product having a distinct name would emerge after removal of impurities and the product will continue to be refused.
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