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TMI Blog2006 (2) TMI 318X X X X Extracts X X X X X X X X Extracts X X X X ..... fertilizers. They are using furnace oil for production of steam, which in turn is used in the manufacture of fertilizers viz., urea. The point at issue is whether the appellants are entitled for benefit of Notification No. 75/84 dated 1-3-84 under Entry No. 25, wherein the rate of duty on furnace oil intended for use as feed stock in the manufacture of fertilizers is nil. Since the furnace oil is first utilized for the manufacture of steam, the department is of the view that the benefit under SI. No. 25 of the Notification would not be available for the furnace oil. In other words, this is a case where furnace oil is used otherwise then as feed stock in the manufacture of fertilizers. Therefore, Entry No. 26 would be more appropriate. This ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearly held that if LSHS/FO is used for exclusive manufacture of Ammonia, the benefit is available but if it is sold as such the benefit of Notification is not available. There is no conflict in these decisions. It is therefore submitted that if the process or activity is integrally related to the ultimate manufacture of goods, the exemption would be available. (iv) The flow chart for the manufacture of urea using furnace oil was furnished but the Asst. Commissioner has totally ignored the same. His order is not a speaking order. (v) The Commissioner (A) also did not discuss about the process of manufacture of urea using furnace oil nor the flow chart of the manufacturer. He has vaguely observed as fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d oxygen is subjected to partial oxidation in gasifier. This process results in production of raw gas which contains about 55% carbon monoxide. The raw gas is mixed with further steam and in this process hydrogen from steam is liberated. The hydrogen so obtained is purified and mixed with nitrogen and synthesized to form ammonia. This ammonia is converted to urea fertilizer. The appellant's contend that the use of furnace oil in the above mentioned process is integrally connected with the manufacture of the final product and hence, it should be considered that the furnace oil is used as feed stock. A careful reading of the Notification indicates that furnace oil can be used in the manufacture of fertilizers either by use as feed stock or by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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