1. Question involved in this appeal of Revenue is whether dilution of Altherin to 3.6% concentration (w/w) from 90% concentration brings into existence a new excisable commodity known to the market having different name, character or use and therefore, whether the new product so brought into existence by dilution will be liable to duty again.
2. We have heard the learned JDR, Shri Ravinder Babu in support of Revenue's appeal. His vehement contention is that earlier concentrate of the said chemical was to kill larger insects and the present product only kills mosquitoes. He, in fact, submits that mosquitoes are merely paralysed or immobilized. They are not even killed but we note that this contention is not substantiated by the learned JDR because there is no evidence of it on record. Authorities below have treated present product as mosquito destroyer which means it kills mosquitoes. He, therefore, urges that the use of the product having undergone a substantial change, the process of dilution should be considered as process of manufacture.
3. As against the above, the learned Advocate, Shri Devnath for the respondents submits that the product remains the same; it is merely diluted in concentration. Mosquito is also an insect. Therefore, the product remains as an insecticide. He relies for his submission on Tribunal's judgment in the case of C.C.E. v. Markfed Agro Chemicals reported in 1993 (68) E.L.T. 848 (T) relied upon by the lower appellate authority while deciding against the Revenue.
3.1 He further points out that one of the grounds taken by the Revenue in its appeal is that the Board has issued a circular under Section 37B of the Central Excise Act, 1944 but he submits this circular of the Board has been quashed by three different High Courts as per the following citations :- (2) Para 5 of the said judgment refers to Bombay High Court's judgment in Special Civil Application No. 9034, 8580, 8730, 9035 and 9036 of 1995 decided on 15th April, 1996 holding it as above.
(3) 1996 (88) E.L.T. 35 (Guj.) - Indichem v. Union of India Learned Advocate, therefore, submits that the appeal has no substance and be dismissed.
4. We have carefully considered the pleas advanced from both sides. We agree with the Tribunal's judgment that dilution of the chemical in question involved herein does not lead to any process of manufacture.
The product's name and use remain the same and character also remains the same excepting that more concentrated form may be killing other insects whereas the present diluted product may kill specified insects namely mosquitoes. The product, therefore, remains insecticide in character, in use and in name. We also agree with the submission of the learned Advocate that the Board's circular can be of no help and stands already quashed by three High Courts. Hence, we dismiss the appeal.