TMI Blog1995 (10) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... -III set up and established by the Heavy Water Plant of the Department of Atomic Energy within their battery limits for the production of synthesis Gas. 2. The facts of the case are that the appellants are served with a show cause notice in January, 1987 alleging that they were engaged in the manufacture of various excisable goods falling under Chapters 27, 28, 29, 31 and 39 of the Central Excise Tariff Act, 1985. They had filed the classification list Nos. C.L. No. 3/86 and 8/86 for Methane falling under Chapter 27, sub-heading No. 27.11 and sub-heading 2711.29 and had claimed exemption under Notification No. 276/67-C.E. (as amended) for captive consumption or for removal under Chapter X procedure of the Central Excise Rules, 1944 on the ground that under the provisions of Rule 140(2) of Central Excise Rules, 1944 their premises have been declared as refinery and in support had filed a copy of order F. No. 261/14HH/10/73- CX B, dated 23-7-1973 from the Government of India, Ministry of Finance (Department of Revenue Insurance) New Delhi. It is alleged that the said order of the Ministry furnished by them in respect of their claim for exemption under the said Notification claimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pose of manufacture of Ammonia or Fertilizer for which the Notification has been intended. It is his submission that the Notification does not stipulate the company to be declared as a refinery for the purpose of manufacture of Methane only other than the one mentioned in the Notification. He also pointed to Rule 140(2) and submitted that it does not stipulate for filing of a declaration in respect of refinery which manufactured other type of goods. It is his submission that the Government of India s orders had not been withdrawn and it continued to be operative and the order also does not state that the benefit of exemption is not to apply for Methane. Methane is manufactured from raw Naphtha, hence it is his submission that wordings in the Notification namely, in relation to raw Naphtha , for which the refinery having been declared, applies to all goods manufactured by the appellants and hence the benefit cannot be denied to raw Methane. He submitted that the Government of India s orders and Rule 140 have to be read together in a harmoneous manner and interpreted. He submitted that all products which are classifiable under Chapter 27 are exempted from levy of duty under the Noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise leviable thereon under section 3 of the Central Excises and Salt Act, 1944 (1 of 1944) : Provided that any of the excisable goods having its flash point below twenty-five degrees of Centigrade thermometer and not less than 7% by volume of which distils above 215oC, and cleared under this clause for use as industrial fuel (but not as fuel for internal combustion engine), shall be exempted from so much of the duty leviable thereon as is in excess of - Rs. 103.43 per KL at 15 (a) o C in the case of motor spirit, kerosene, refined diesel oil and diesel oil not otherwise specified; and Rs. 103.45 per KL at 15 (b) o C in the case of furnace oil and other petroleum products. SCHEDULE Antibiotics Pharmaceuticals Carbon blacks Plastics. Chemicals Plasticizers. Omitted. Polyisobutylenes. Dye-stuffs and dyestuff intermediates. Synthetic fibres. Pesticides. Synthetic rubbers. As per the terms of the above Notification, the Central Government exempts the excisable goods falling under Chapter 27 of the Schedule to the Central Excise Tari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enced under sub-rule (1) and the provisions of this Chapter shall apply in relation to the goods processed or manufactured in such refinery as they apply in relation to the goods stored in a warehouse appointed or licenced under sub-rule (1)." As can be seen from the above Rule, the Central Government has already declared the appellant s company as a refinery for the purpose of raw Naphtha, which is a basic material or input utilised by the appellants for the purpose of manufacture of various goods. This raw Naphtha which is brought in pipelines and stored by the appellants for the purpose of manufacture of various goods falls under Tariff Item 6 and it is the only basic raw material. Therefore, the order of the Government of India is two-folded, one it declares the premises of the appellants as a refinery and secondly, on such declaration the refinery shall be deemed to be a warehouse appointed or licenced under sub-rule (1) and the provision of the Chapter VII dealing with the warehouse and it shall apply in relation to the goods processed or manufactured in such refinery as they apply in relation to the goods stored in a warehouse appointed or licenced under sub-rule (1). Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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