JUDGMENT

N.P. SINGH, J. : ( This appeal has been filed against an order dated 28-3-1985 passed by the Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as the Tribunal). By majority decision (2:1), the Tribunal has held that the metal screw cap put on the bottle of the Horlicks is no part of the manufacturing process, because the Horlicks itself is a finished product and ready for consumption when it reaches the bottling plant. As such the metal cap cannot be held to be a component part to the finished product of Horlicks, so that it can be held to be excisable goods covered by Notification No. 201/79-CE. On that finding, the order passed by the Collector (Appeals) was set aside. The Collector (Appeals) had held that screw cap used for the container of the Horlicks was very much an input and a component part, because without the screw cap, the prepared and preserved food like Horlicks cannot be packed into unit containers for purpose of sale. A direction had also been given by the Collector (Appeals) to allow the credit on account of duty paid on the screw caps in terms of Notification No. 201 /79-CE to the appellant.

2. It appears that under Rule 8 of the Central Excise Rules, 1944 by Notification No. 178 /77-CE dated 18-6-1977 general exemption of duty was granted in respect of excisable goods on which duty of excise is leviable and in the manufacture of which any goods falling under Tariff Item No. 68 of the First Schedule to the Central Excises and Salt Act, 1944 have been used from so much of duty of excise leviable thereon as equivalent to the duty of excise already paid on the inputs. Notification No. 201/79-CE was published on 4-6-1979. In this Notification procedure for availing set off was duly laid down. Notification No. 201/79-CE at the relevant time read:

In exercise of the powers conferred by sub-rule (1) of Rule 8 of the Central Excise Rule, 1944, and in supersession of the notification of the Government of India in the Ministry of Finance (Dept. of Revenue) No. 178 / 77-CE dated 18 June, 1977, the Central Government hereby exempts all excisable goods (hereinafter referred to as the said goods), on which the duty of excise is leviable and in the manufacture of which any goods falling under Item 68 of the First Schedule to the Central Excises and Salt Act, 1944 (1 to 1944), have been used as raw materials or component parts (hereinafter referred as "the inputs"), have been used, from so much of the duty of excise leviable thereon as is equivalent to the duty of excise already paid on the inputs".

3. The appellant in view of the aforesaid notification claimed that the metal screw caps which are used on the bottles that contain the product Horlicks are component parts to the Horlicks and therefore shall be deemed to qualify for the exemption under the said notification. In support of the said stand, reference was also made to Item No. IB CET, the relevant part whereof is :-

"Prepared or preserved foods put up in unit containers and ordinarily intended for sale, including preparations of vegetables, fruits, milk, cereals, flowers, starch, birds, eggs, meat, meat offlas, animal blood, fish, crustaceans or molluscs, not elsewhere specified".

According to the appellants, the expression put up in "unit containers" makes the Horlicks an excisable article only when it is put up in unit containers. It was pointed out that the manufacturing process of the Horlicks is not complete only by manufacture of the Horlicks powder, but it culminates only when it is packed in bottle with metal screw container; only at that stage not only it becomes marketable but also becomes an excisable article.

4. The majority judgment pointed out that as the Item IB covers "prepared and preserved foods" there shall be a fallacy if it was held that container formed an integral part of the finished product. It was further pointed out that products like preserved foods or canned meat, canned fish or milk or vegetables were sol