Law: Central Excise Act, (I of 1944)

Section: 12A

[CENTRAL EXCISES ACT, 1944)].......Section 12-A---Cement provided for the purpose of construction is a raw material and is liable to 40% duty under SRO. 456(I)/96, dated l3.06.1996.--The Army Welfare Trust Nizampur Cement Plant, had supplied cement in huge quantities to Ghazi Barotha Project for the construction of Dam, The appellant paid central excise duty at the rate of Rs.40% under SRO. 456(I)/96 dated 13.6.1996. On the report of Deputy Director, Director General of Intelligence and Investigation (Customs and Central Excise), Peshawar, the Additional Collector Customs, issued show cause notice to the respondent on 31.5.1999 stating that the cement so sold was liable to central excise duty at the rate of 70% under SRO. 455(I)/96 dated 13.6.1996 as amended by SRO. 902(I)/98 dated 27.8.1998. Black's Law Dictionary defines raw material as "goods purchased for use in manufacturing a product for example wood, steel". Product has further been defined to mean, inter alia, "goods produced or manufactured either by natural means, by hand, or with tools, machinery, chemicals or the like". The cement which is further used for the manufacture of products could be brought within the meaning of raw material as used in SRO. 555. Intermediary product is a product which is marketable. The cement provided by the respondent to Ghazi Barotha Project was for the purpose of construction and not for the manufacture of goods or articles or an intermediary product. If it is held that cement used in construction would fall within the definition of raw material, the inclusion of cement in SRO. 456 would be rendered meaningless as cement is always put to further use. It is the basic principle of construction of statutes that effect is to be given to all statutory provisions so as not render any part redundant. Cement supplied by the respondent to Ghazi Barotha Project was liable to duty at 40% under SRO. 456(I)/96. Intermediary product is a product which is marketable. INTERPRETATION OF STATUTES Effect is to be given to all statutory provisions so as not render any part redundant. NOTIFICATION NO. S.R.O. 456(I)/1996, DATED 13.06.1996 Cement provided for the purpose of construction is a…

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