HINDUSTAN ZINC LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE issue involved in these two appeal filed by M/s. Hindustan Zinc Ltd. is whether the process of conversion of lead/aluminium sheets into electrodes is a process of manufacture within the meaning of Section 2(7) of Central Excise Act.

(2.) WE heard Shri V. Lakshmikumaran, learned advocate for the Appellants M/s. Hindustan Zinc Ltd, and Shri Vikas Kumar, learned Senior Departmental Representative for Revenue. Initially it has been held by the Tribunal that the process undertaken by M/s. Hindustan Zinc Ltd does not amount to manufacture as a new commodity known to the market does not come into existence. On appeals preferred by the Revenue, the Supreme Court has held vide Order dated 24.03.2004 reported in 2004 (166) ELT 145 (SC) that lead and aluminium sheets by themselves can not and does not act as electrodes. They become electrodes only after the process is undertaken by M/s. Hindustan Zinc Ltd. and thus the lead and aluminium sheets are converted into electrodes which is a new product known in the market with a distinct, name, character and use. The Supreme Court has also held that that there was conscious withholding of information and thus extended period of limitation has been rightly invoked. Finally, the Supreme Court considered the question "as to whether the respondents (M/s. Hindustan Zinc Ltd.) are liable to pay the duty or the job workers are liable to pay the duty". The Supreme Court has remanded the matter as this would require looking into the facts and material.

(3.) AS this aspect as who will pay the duty whether M/s. Hindustan Zinc Ltd. or the job worker requires looking into the facts and material, we remand both these appeals to the jurisdictional Adjudicating Authority to decide this aspect after affording reasonable opportunity of hearing to M/s. Hindustan Zinc Ltd. Both the appeals are thus allowed by way of remand.