The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that cinder is not a dutiable goods and therefore, deleted the excise demand on the same from the department.
The appellants were clearing waste materials namely cinders to Dalmia Refractories without payment of duty who in turn sold the same to various buyers on cost. Department took the view that clearances of cinders are to be subjected to duty at tariff rate.
The Apex Court decision in Ahmedabad Electricity Co. Ltd. and held that cinder is not an excisable product.
Following the decision, the Central Board of Excise and Customs (CBEC) had withdrawn the circular dt. 07.04.1998.
The Tribunal observed that “the Explanation is only an amplification only for goods which are “excisable goods”. In other words, the said Section 2(d) and its Explanation will obviously not be applicable to goods which are not excisable. As discussed earlier, the effect of Board’s circular dt. 18.11.2005 is to accept that Supreme Court’s ruling that cinder is non-excisable commodity. That particular circular has not been withdrawn. Hence cinder will continue to be a non-excisable commodity during the period of dispute, notwithstanding subsequent amendment to Section 2(d) ibid w.e.f. 10.05.2008.”
“In the light of discussions herein above, we find that the impugned order upholding the view of original authority that cinder is a dutiable product and exigible to Central Excise duty cannot be sustained and will require to be set aside which we hereby do. Appeal is allowed with consequential relief, if any, as per law,” the Tribunal said.
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