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2016 (2) TMI 201 - CESTAT BANGALORE

2016 (2) TMI 201 - CESTAT BANGALORE - TMI - Duty liability of mercury - Excisability - Held that:- Mercury obtained through manufacture of caustic soda and cleared as such is liable to duty of Central Excise. In this regard, CESTAT Delhi’s decision in the case of Modi Alkalies & Chemicals Ltd. (2005 (4) TMI 113 - CESTAT, NEW DELHI ) also aptly reinforces Revenue's stand that the mercury cleared as such is liable to duty of Central Excise. - Decided against assessee - Appeal No. :E/147/2007 - FIN .....

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later changed their manufacturing process to the Membrane Cell Process and had stopped production of caustic soda through the Mercury Cell Processing plant. The appellant had stock of 42262.5 kg of mercury in the plant and sold the said mercury on 22.9.2004 without payment of duty and without raising any invoice. 2. The Revenue issued the appellant show-cause notice asking for the duty at the rate of 16% totalling to ₹ 17,78,406/-. 2.1 The Revenue vide order of Joint Commissioner confirmed .....

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hloride upon electrolysis produced Sodium which dissolves in mercury to form an AMALGUM which later reacts with water to produce Sodium Hydroxide with the liberation of Mercury. There is no reaction taking place inside the cell and the Sodium is merely carried by Mercury into next cell where the Sodium is liberated leaving the Mercury unaffected. Thus the Mercury remained the same commercial product but for process of contamination with some impurities and on the clearance of the said used/conta .....

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was therefore, not a case of clearance of input as such for the purpose of determination of any duty liability under the CENVAT Credit Rules. There was no provision in the CENVAT Credit Rules warranting a reversal of credit of duty on the Mercury in circumstances where the input was not cleared as such to rather clearance was of used inputs. 3.1 The appellant further pleads that there was no justification for imposition of penalty equal to the duty liability under Section 11AC of Central Excise .....

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to be paid. In support Revenue cited the decision of Delhi Tribunal in the case of Modi Alkalies & Chemicals Ltd. vs. CCE: 2005 (186) E.L.T. 202 (Tri.-Del.). Revenue also cited the decision of Hon ble Supreme Court in the case of Lord Chloro Alkali Ltd. vs. CCE: 2015 (322) E.L.T. 822 (S.C.). 5. After careful examination of the facts on record and the submissions made by both sides, we are of the considered view that the facts are similar to the cases cited by the Revenue i.e., the case of M .....

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