Judgement

SHELAT, J.: These appeals, by certificate, are against the common judgment of the High Court of Punjab which dismissed the writ petitions filed by the appellant companies challenging the legality of excise duty levied against them under Item 14-H in Sch. I to the Central Excises and Salt Act, 1 of 1944. Writ Petition 212 of 1966 by Tata Chemicals Ltd. also raises the same question. As both the appeals and the writ petition raise a common question of law they were heard together and are disposed of by this common judgment.

2. The appellant companies manufacture sugar by carbonation process as against sulphitation process employed by some other manufacturers of sugar and pay excise duty on the sugar manufactured by them under Item 1 of Sch. 1 to the Act. According to the affidavit of V. J. Bakre, Deputy Chief Chemist of the Central Revenue Control Laboratory, these manufacturers burn limestone with coke in a lime kiln with a regulated amount of air and generate a mixture of gases consisting of carbon dioxide, nitrogen, oxygen arid a small quantity of carbon monoxide. Most of the oxygen from the air is used up by the coke in the process of burning itself. The coke so burnt supplies the heat which decomposes the limestone so as to generate carbon dioxide. The gas thus produced is sucked by a pump through a pipe which connects the kiln with the inlet side of the pump. The gas enters the chamber of the pump and is then immediately compressed by means of the compression stroke of the pump. At this stage the gas is forced into a narrower space and as a result of the compression stroke it acquires pressure exceeding the atmospheric pressure. The gas so compressed is let into the delivery pipe which connects the outlet side of the pump with the tank containing the sugarcane juice and enters the sugarcane juice with the acquired pressure behind it. But for the compression resulting in pressure the gas would not bubble in the sugarcane juice. In the tank there is besides the sugarcane juice milk of lime which is mixed so as to remove the impurity in and refine the juice. Thus, it is carbon dioxide which reacts on the lime and what is produced is an insoluble content known as calcium carbonate. The other gases, viz., nitrogen, oxygen, carbon monoxide do not contribute in the process of clarification of the sugarcane juice. These are innocuous so far as the process of clarification of sugarcane juice is concerned and escape into the atmosphere by a vent provided in the sugarcane juice tank. Along with these gases a certain amount of carbon dioxide which remains unabsorbed also escapes. The carbon dioxide content in the mixture of gases ranges from 27 to 36.5 per cent. Thus, the process involves the forcing of impure carbon dioxide into a narrower space within the chamber of the pump where it is compressed and pushed first into the delivery pipe and then into the tank containing the juice. The respondents case therefore was that the process employed by the appellant companies involves compressing carbon dioxide and with the pressure achieved pushing it through sugarcane juice. The appellant companies therefore produced carbon dioxide through the lime kiln which was taken first to the CO2 pump and there compressed and then pushed into the tank.

3. The Tata Chemicals Ltd. manufactures among other products soda ash by solvay ammonia soda process. The solvay process as described by the said V. J. Bakre is as follows:-

4. First common salt is dissolved in water and ammonia gas is passed through such dissolved salt called brine. The ammonia gas gets absorbed in the brine. The solution so formed is called AB solution, that is, ammoniated brine. The AB solution is introduced at the top of a carbonating tower and passed from section to section from the top to the bottom of the tower. At the bottom of the tower compressed carbon dioxide is forced through at a pressure of 40 to 50 pounds per square inch and is bubbled through the liquid in all t