COMMISSIONER OF CENTRAL EXCISE Vs. NEELKANTH POLYMERS

JUDGEMENT

(1.) IN this Appeal, filed by Revenue, issue involved is whether the benefit of exemption under Notification No. 8/97 -C.E., dated 1 -3 -97 is available in respect of Churi Korma.

(2.) SHRI Atul Dixit, learned SDR, submitted that M/s. Neelkanth Polymers, a hundred per cent Export Oriented Undertaking, manufacture 'Guar Gum Powder' from guar' seeds; that during the said process, a byproduct namely 'Churi Korma' is also obtained; that the Deputy Commissioner, under Adjudication Order No. 1/2001, dated 24 -7 -2001 denied the benefit of Notification No. 8/97 -C.E. on the ground that Churi Korma, being a by -product is also a finished product which is being sold by the Respondents in the market and the proviso to Notification No. 8/97 -C.E. is attracted; that the Commissioner (Appeals), however, under the impugned Order, set aside the Adjudication Order holding that the benefit of Notification would be available to the Respondents so long their finished product, i.e., Guar Gum Powder is not chargeable to Nil rate of duty and that rejects and waste or scrap would not be affected by the Proviso to Notification. The learned SDR, further, submitted that Churi Korma, being a by -product is also a final product as the Respondents sell the same without any further processing; that as Churi Korma, falling under Heading 23.02 of the Schedule to the Cen tral Excise Tariff Act attracts Nil rate of duty, the proviso to Notification 8/97 is attracted which reads as under :

(3.) ON the other hand, Shri O.P. Agrawal, learned Chartered Accountant, submitted that guar seeds are grounded and screened in Chhalnas'; that during screening, the waste material, which is locally known as "Guar Churi korma" is separated from the main product; that Churi Korma is nothing but waste and by no stretch of imagination, it can be called a finished product so as to fall within the mischief of the Proviso to Notification No. 8/97 -C.E.; that Department of Industrial Policy and Promotion vide letter dated 28 -10 -97 has recognized Churi Korma as a waste.