Clearance of Spent Sulphuric Acid Emerged as By-product to Fertiliser companies are Exempted from Payment of Excise duty under Exemption Notification: CESTAT [Read Order]

The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that clearing Spent Sulphuric Acid to the fertilizer companies, which are exempted from payment of excise duty in terms of Notification No.4/2006-Central Excise. 

A.R.Stanchem Private Limited, the appellant assessee was a 100% Export Oriented Unit (EOU) and was manufacturing Linear Alkyl Benzene Sulphuric Acid (LABSA) falling under Central Excise Tariff and Spent Sulphuric Acid emerging as a by-product out of the inputs i.e. Liner Alkyl Benzene Sulphuric Acid and Spent Sulphuric Acid. 

The assessee appealed against the order passed by the adjudicating authority to confirm the demand of differential duty along with interest and to impose penalties on the assessee. 

N.K.Chowdhury, the counsel for the assessee contended that with the clearance of Spent Sulphuric Acid to the fertilizer companies, the assessee was also eligible for payment of a ‘nil’ rate of duty in terms of Exemption Notification, and the exemption would apply to the assessee. 

K. Chowdhury, the counsel for the department relied on the decisions made by the lower authorities and contended that the assessee was not eligible for the exemption related to the clearance of spent sulphuric acid which emerged as a by-product. 

The Bench observed that as per the exemption notification no: 4/2006 of Central Excise the clearing of Spent Sulphuric Acid to the fertilizer companies, which are exempted from payment of duty. 

The two-member bench comprising Ashok Jindal (Judicial) and Anpazhakan (Technical) held that the assessee was eligible for the exemption from the payment of excise duty for the spent sulphuric acid which emerged as a byproduct. 

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