G. Sankaran, President

1. Being aggrieved with the Order-in-Appeal No. 11/87 (G)(D) dated 3-2-1987 passed by the Collector of Central Excise (Appeals), Madras, M/s. Andhra Sugars Ltd. have filed the instant appeal.

2. The facts of the case, briefly stated, are that M/s. Andhra Sugars Ltd. were engaged in the manufacture of Aspirin. For this purpose they used to bring into their factory excise duty paid Acetic Anhydride, falling under Item 14AAA of the First Schedule to the Central Excises and Salt Act, 1944 (the said Schedule being hereinafter referred to as "the Schedule"), as a raw material. The manufacturing process is essentially to react Acetic Anhydride with Salicylic Acid resulting in production of Aspirin (falling under Item 68 of the Schedule) and Acetic Acid. The reaction could be represented as follows:

[The chemical formula for Acetic Anhydride is (CH3CO)2° and that for Acetic Acid (CHa COOH)]. The resultant products are separated by a further chemical process. The appellants had paid duty on the Acetic Acid which was one of the resultant products in the above reaction. Later on, they filed two claims for refund of the duty paid on Acetic Acid during the periods from