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Jains Mines and Minerals India Ltd V/S Commissioner of Central Excise and Service Tax

    Excise Appeal No. 51173/2016 (Arising out of the Order-in-Appeal No. BHO-EXCUS-002-APP- 242-15-16, Dated: 19.11.2015 Passed by The Commissioner (Appeals) of Central Excise, Customs and Service Tax, Raipur) and Final Order No. A/57214/2017

    Decided On, 10 October 2017

    At, Customs Excise Service Tax Appellate Tribunal Principal Bench New Delhi

    By, MEMBER

    For Petitioner: Z.U. Alvi, Advocate And For Respondents: M.R. Sharma, Authorized Representative, D.R.

Judgment Text

1. The appeal is against order dated 19/11/2015 of Commissioner (Appeals), Raipur. The appellants are engaged in processing of iron ore. The dispute is with reference to their Central Excise duty liability on the said process. The appellants contended that the process undertaken by them does not amount to manufacture. The Revenue held a view that such conversion of iron ore into concentrate will amount to manufacture liable to Central Excise duty. The lower authorities confirmed the duty liability of Rs. 18,73,230/- for the period April 2011 to November 2012. Penalty of equivalent amount was also imposed on the appellant. The learned Counsel for the appellant submitted that the processes undertaken by them are mentioned in the impugned order at para 8.2. However, the lower authorities erred in concluding that the process results in the product which can be called as iron ore concentrate. Increase in the "Fe" content in iron ore by various incidental process does not make the final product iron ore concentrate. Reliance was placed on the Board Circular dated 17/02/2012 and the Hon'ble Apex Court decision in Steel Authority of India Ltd. - 2012 (283) E.L.T. A112 (S.C.) and other decided cases.

2. The learned AR reiterated the findings of the lower authorities. He said that the impugned order examined HSN note 2 and 4 of Chapter 26 of the Tariff and arrived at the conclusion. He supported the findings of the impugned order.

3. We have heard both the sides and perused the appeal record. The only dispute in the present case is the liability of the appellant for excise duty on the process undertaken by them. The Board has vide their Circular dated 17/02/2012 on similar set of facts clarified the matter. However, quoting the Board Circular, the impugned order with reference to HSN note, arrived at a different conclusion. We note that the process undertaken by the appellant are not in dispute. There is no special process facility with the appellant. Improvement in the content of "Fe" due to the processes undertaken by the appellant by itself will not make the resultant product as iron ore concentrate. We also refer to the various case laws relied upon by the appellant.

(a) Bheraghat Minerals - 2000 (119) E.L.T. 271 (S.C.) ;

(b) Steel Authority of India - 2003 (154) E.L.T. 65 (T) affirmed by Apex Court - 2012 (283) E.L.T. A112 (S.C.) ;

(c) Indian Rare Earth Ltd. - 2002 (139) E.L.T. 352 (T) affirmed by Apex Court - 2009 (241) E.L.T. A70 (S.C.) ; and

(d) Super Engineering

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- 1996 (82) E.L.T. 539 (T). It is clear that process undertaken by the appellant do not amount to manufacture of new product as understood in the industry. Accordingly, we find the impugned order is without merit and the same is set aside. The appeal is allowed.