TMI Blog1991 (1) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... t petitioner No. 1 is a Private Limited Company, incorporated under the Indian Companies Act, 1956. The petitioner No. 2 is one of the directors of the petitioner No. 1. The petitioners have their factory at Ghaziabad. They are preparing Formed Coal and Formed Coke briquettes from coal. The process for preparation of the Formed Coal and Formed Coke briquettes has been narrated in para 3 of the writ petition. They have asserted that the contents of the formed coke and formed coal briquettes remain the same as in any other coal and coke and hence they do not cease to be coal and coke on account of mere change in the shape by mechanical pressing process. They have asserted that coal and coke briquettes is only a preparation of coal in the same manner as soft coke under the Central Excises and Salt Act, 1944 (hereinafter referred to as the Act). The coal and coke were not classified prior to 1978 for the purposes of levying excise duty. The petitioners had commenced preparation of Formed Coal and Formed Coke in December, 1976. These items were not covered under Tariff Entry No. 68 of the Schedule I of the Act. However, subsequently on 18th June, 1977, the Government of India revised th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assistant Collector holding that the excise duty was leviable under Entry No. 68 in respect of formed coal and formed coke briquettes. The Appellate Collector, however, dismissed the appeal taking the same view which was earlier taken by the Assistant Collector. The petitioners have asssrted that the orders passed by the Assistant Collector and the Appellate Collector were not legal and should be quashed. It is asserted that the excise duty could not be levied under Item No. 68 in respect of formed coal and formed coke briquettes prepared by the petitioners from coal. 3. The contention on behalf of the respondents is that the petitioners manufactured formed coal and formed coke briquettes by using the manufacturing process. The manufactured product, which is formed coal or formed coke, cannot be said to be the same as the coal or coke. Molasses and clay are also added during manufacturing process while preparing the formed coal and formed coke briquettes. These manufactured articles are not covered by Entry Item No. 11D of the Schedule First of the Act, but excise duty will be payable under Item No. 68 which is the residuary article. The petitioners were in the circumstan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0/- per metric tonne was levied. However, by Notification No. 46/78-C.E. all the items covered by Item 11D excepting coal raised from the mines and coke of all sorts were exempted from duty. Subsequently on 27-4-1978 Notification No. 102/78-C.E. was issued. Under this Notification excise duty of Rs. 5/- per metric tonne was levied on coal, excise duty of Rs. 7/- per metric tonne was levied on Coking coal; while coke, of all sorts was exempted from duty. Thus from 27-4-1978 by virtue of Notification No. 102 no excise duty could be levied on coke of all sorts while excise duty @ Rs. 5/- per metric tonne could be levied on coal other than coke. 9. Subsequently on 18-7-1979 Notification No. 231/79-C.E. was issued by the Central Government exempting all excisable articles falling under Item No. 11D of the First Schedule to the Central Excises and Salt Act, 1944 from the whole of the duty of excise leviable thereon under the said Act. In view of this Notification coal and coke all sorts mentioned in Item 11D were exempted from whole of the excise duty. Subsequently Item No. 11D was omitted by Finance Act, 1982 and a new Item 11 was added by the same Act in respect of coal (excluding li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brick shaped blocks to facilitate the use of coal for various purposes including the use in hime sand industry. Further in order to prepare formed coke briquettes the above mentioned formed coke is heated in the manner mentioned above at a high degree of temperature. The purpose is to drive off volatile constituents of the formed coal and to make the same smokeless. The form coke briquettes are also used in industries or homes for heating purposes. The petitioners have asserted that they had sent the formed coal and formed coke briquettes to various institutes for analysing the same. They have filed copies of reports by the Central Fuel Research Institute (Annexure 8) and Institute of Fuel, London (Annexure 9). 14. According to the report dated 26-6-1979 by the Central Fuel Research Institute (Annexure 8) a 'Formed Coal' Briquettes before carbonization and 'Formed Coke' after carbonisation marketed by M/s. Kakar Fuels Private Limited, Ghaziabad, is nothing but coal and coke. 15. The report by the Institute of Fuel, London (Annexure 9) says that the product 'Formed Coal' before Carbonisation and 'Formed Coke' as marketed by the petitioner is nothing but coal and coke which is c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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