I.J. Rao, Member (T)

1. The Appellants before us M/s. Tata Iron & Steel Co. Ltd., a limited Co., are primarily engaged in the manufacture of iron and steel at its Works at Jamshedpur. They also hold a Licence U/S 28 of the Indian Electricity Act, 1910 for supply of electrical energy to the public within the sanctioned area. They set up three capital power houses inside their Works area primarily and essentially to meet the requirements of the Works. The generation of electricity from their own Power Houses not being sufficient to meet the capital and public demand, a considerable quantity of electricity is purchased by the appellants from Damodar Valley Corporation (DVC in short).

2. In 1978 electricity became liable to Central Excise Duty, being classified as Tariff Item 11 (E). In the same year, the Central Government exempted from duty electricity on the condition that the same is generated in an industrial unit and is consumed there. (Notification No. 52/78-CE).

3. The Central Excise Deptt. took into consideration the factual position that the electricity generated by the appellants gets mixed up with the electricity supplied by DVC. Therefore, there is no separate identity f