SEN, J. - (1.) THE appellant, Balaji Enterprises, purchases aluminium ingots from the market and manufactures aluminium containers which are used according to the permission granted by the Excise Authority under Rule 56-A of the Central Excise Rules. The process followed for making the containers has been stated by the appellant in a letter to the Assistant Collector of Central Excise. The appellant melts the ingots, converts them into slabs, rolls them into sheets which are converted into circles. These circles are converted into containers which are sold in the market. The appellant pays duty on the containers manufactured by it in regular course. In the process of manufacturing containers, waste products such as aluminium scrap also come into existence.
(2.) THE Central Excise Authority called upon the appellant to pay duty on the scrap manufactured by it. The appellant was compelled to pay duty on the value of the scrap at the rate of 40 per cent under Tariff Item 27(a)(i) of the Central Excise Tariff. The appellant's case before the Department was that 'scraps' generated in course of manufacture of aluminium containers by the appellant, could not be classified under TI 27(a)(i) of the Central Excise Tariff which before 1-3-1981 was as under:- 27-ALUMINIUM JUDGEMENT_268_5_1997Html1.htm Explanation : I - "Container" means containers ordinarily intended for packaging of goods for sale, including collapsible tubes, casks, drums, cans, boxes, gas cylinders and pressure containers whether in assembled or unassembled condition, and containers known commercially as flattened or folded containers. Explanation : II - In this Item, the expression "Aluminium" shall include any alloy in which aluminium predominates by weight over each of the other metals. The appellant's case is that 'aluminium scrap' cannot be described as 'aluminium in any crude form'. Aluminium scraps are not really in crude form. In fact, TI 27(a)(i) makes it clear that it is only the commodities known in the market like ingots, bars, blocks, slabs, billets, shots and pellets, which can be taxed under TI 27(a)(i). But scraps remaining after manufacturing products like utensils cannot be brought to tax under TI 27(a)(i) as 'aluminium in any crude form'.
(3.) TI 27(a)(i) speaks of 'aluminium in any crude form'. Ingots, bars, blocks, slabs, billets, shots and pellets have been specifically brought within the Tariff Description. That, however, does not mean that only the articles which have been specifically mentioned in TI 27(a)(i) are excisable to duty. The Tariff Description is inclusive which means as such apart from ingots bars, blocks, slabs, billets, shots and pellets, other things that may come within the description of 'aluminium in any crude form' will be excisable to duty as such. The problem in this case, however, is about the nature of the scraps produced by the appellant. Can the scraps be regarded as 'aluminium in any crude form'? Obviously Tariff Item 27(a) will not take in aluminium in any finished form. The dictionary meaning of 'crude' is "In a state needing preparation for use; not refined; raw; uncooked" (Webster Comprehensive Dictionary, International Edition 1984).;