STAR PISTONS PVT. LTD. Vs. CCE

JUDGEMENT

(1.) In these two appeals, arising. out of two different Orders -in -Appeals, the common issue involved is whether Aluminium ash or dross are chargeable to Central Excise duty.

(2.) Shri Jitender Singh, learned Advocate, submitted that both the Appellants, M/s. Star Pistons Pvt. Ltd. and M/s. Meteor Satellite Pvt. Ltd. manufacture mould for manufacture of automobile pistons, pistons for 2 wheelers and other articles of aluminium; that the main output is aluminium ingots which are melted for manufacture of the final products; that the aluminium ingots are melted at the temperature around 900"C; that during the process of melting outside surface of the ingots remain in contact with air and as a result of which the process known as 'oxidization' takes place; that as a result of Oxidization' of aluminium metal, lumps and powder are formed which get accumulated on the surface of molten metal which are known as 'Skimmings' as these are obtained by skimming of oxide layers before molten metal is transferred to castings; that these products are also known as aluminium ash or dross and basically comprises of aluminium metal in the form of dross and skimmings; that the Revenue has held the impugned product aluminium ash and dross as excisable product on the ground that there is a Tariff Heading in the Central Excise Tariff i.e., Heading No. 26.20 under which ash and residues containing metal or metal components are chargeable to Central Excise duty. Learned Advocate, further, submitted that the issue involved in both these appeals has been settled by the Supreme Court in the case of Union of India v. Indian Aluminium Company Ltd. , wherein it has been held that everything which is sold is not necessarily a marketable commodity as known to the commerce and dross and skimmings are not marketable commodity even if they can be sold to recovery some metal. He, further, mentioned that the Supreme Court has observed that aluminium dross and ash do arise during the process of manufacture but these are nothing but waste and rubbish, which is drawn in the course of manufacture; that Supreme Court has also dismissed the Appeal filed by the Revenue against the decision of Tribunal in the case of CCE v. Aluminium Industry Ltd. as reported in 2003 (151) ELT A 288. The Tribunal in the said matter has held that dross and skimmings are not liable to duty. Reliance has also been placed on the decision in the case of Hindalco Industries Ltd. v. CCE, Allahabad wherein it has been held that aluminium dross, pod dug out material and furnace dug out material arising during the process of manufacture are not manufactured item and are not goods as criteria of marketability also is not satisfied; that the Tribunal in the present matter has also held that the ratio of the decision in the case of Indian Aluminium Company (supra) will continue to apply even in the context of the New Tariff as there is no material change in the definition of manufacture as contained in Section 2(f) of Central Excise Act and the Tariff heading 26.20 will not per se be sufficient for determining the excisability without determining whether the items came into existence as a result of manufacture.

(3.) Countering arguments, Mrs. Charul Barnwal, learned Senior Departmental Representative, reiterated the findings as contained in the impugned order.