- (1.) Various show cause notices were issued by the Appellant/Revenue demanding duty in respect of gold manufactured and cleared allegedly without payment of duty started from the show cause notice dated 1st June, 2001. In this show cause notice, it was inter alia stated that the Respondent had Precious Metal Recovery Plant (PMR Plant) for the recovery of precious metal starting from anode slime. That the process of manufacturing of gold was explained by Mr. P.K. Chandra, Manager (PMR Plant) of the Assessee which is recorded in the said show cause notice as well, is that during electro refining of copper the insoluble impurities of copper anode like silver, gold, selenium, copper, tellurium, barite and silica are collected at the bottom of the electrolytic cells as black mud which is called anode slime. The copper remaining in the anode slime is removed by leaching with sulfuric acid and then it is filtered to get decompressed anode slime. The flow chart, which shows the stage at which anode slime forms was explained by submitting that from anode slime, silver is recovered, thereafter gold mud and from gold mud, gold bars are produced which are sold in the market. It is on this gold bar, which is the final product, the Revenue wanted to levy excise duty which is @ 16%. The Assessee, on the other hand, submitted that the product in question was covered by exemption Notification No. , dated 1 -3 -2002 attracting nil duty. Serial No. 170 thereof in which the product is sought to be included reads as under: The question, therefore, that falls for consideration is, as to whether the aforesaid product produced by the Assessee is the "primary gold" which is exempted from payment of excise duty.
(2.) We may mention here that insofar as Adjudicating Authority is concerned, it passed the Order -in -Original dated 2 -6 -2003 confirming the demand made in the show cause notice and held that the aforesaid exemption Notification does not apply to the product in question as the product in question is not any "primary gold". This order was challenged by filing appeal before the Commissioner who also rejected the appeal vide order dated 24 -2 -2005. The matter was further taken up before the Custom, Excise & Service Tax Appellate Tribunal by the Respondent. Two members who heard the matter differed with each other. Member (Technical) decided the issue in favour of the Assessee taking a view that the product in question was "primary gold" and, therefore, does not attract to levy of excise duty.
(3.) Because of this difference of opinion, the matter was placed before the third member who has concurred with the opinion of the technical member holding that the Assessee shall be entitled to the benefit of the aforesaid Notification and, therefore, product in question is not liable for any excise duty.;