The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal in a ruling in favour of Hindalco Industries Ltd has held that Excise Duty is not leviable on Aluminium Dross and Skimming Generated While Processing Aluminium Ingots.
M/s Hindalco Industries Ltd, a manufacturer of aluminium sheets and coils, is the leviability of duty under the Central Excise Act, 1944 on ‘aluminium dross and skimming’ generated while processing ‘aluminium ingots’ in their facility.
The order of the Commissioner of Central Excise & Customs, Belapur has confirmed the demand of ₹ 55,54,467 and ₹ 71,67,294 for January 2012 to June 2012 and from July 2012 to December 2012 respectively by relying on the meaning assigned to ‘excisable goods’ after insertion of ‘Explanation: For this clause. “goods” includes any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable’ in section 2(d) of Central Excise act, 1944 with effect from 10th May 2008.
Besides charging interest under section 11AA of the Central Excise Act, 1944 on the duty ordered to be recovered under section 11A of Central Excise Act, 1944, the penalty was also imposed under rule 25 of Central Excise Rules, 2002.
The appellant stated the oxidizing of the top layer of molten aluminium by exposure to air upon heating of aluminium ingots in a furnace causes a thin film to form which is manually removed and is nothing but a waste product.
Though a Larger Bench of the Tribunal had, in Hindalco Industries Ltd v. Commissioner of Central Excise, held that the ‘aluminium dross and skimming’ are liable to duty, reversal of that decision by the High Court of Bombay in Hindalco Industries Limited v. Union of India [2015] was affirmed by the Supreme Court in dismissing of the special leave petitions (SLP) of Revenue t
It was further submitted that relying on the aforesaid decisions, the Tribunal, in dispute for the period May 2008 to December 2011 at the Taloja unit and Daheli unit, had, in Hindalco Industries Ltd v. Commissioner of Central Excise, Navi Mumbai and another [2022 ], set aside the demands.
In the light of the decision of the High Court of Bombay, the two-member Mr C J Mathew, Member (Technical) and Mr Ajay Sharma, Member (Judicial) in their matter on the very same impugned goods, which was affirmed by the Supreme Court in Union of India v. Hindalco Industries Limited – 2019 (367) ELT A246 (SC)] holding that
“In view of the decision in Union of India v. DSCL Sugar Ltd., 2015 (322) E.L.T. 769 (S.C.), nothing survives for consideration in these Special Leave Petitions and the Civil Appeal. The Special Leave Petitions and the Civil Appeal are dismissed accordingly.” The CESTAT allowed appeal by setting aside the impugned order.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
