M. Santhanam, Member (J)

1. This matter has been referred for decision by the larger bench, since by its order dated 5-5-1987, the special bench consisting of S/Shri G. Sankaran, Vice-President (as he then was), Sh. V.T. Raghavachari, Member (J) was not inclined to agree with the view taken by the three members [S/Shri S. Venkatesan, Sr. Vice-President (as he then was), Smt. S. Duggal, Member (J), Sh. K.L. Rekhi, Member (T)], in the case of Punj Sons (P) Ltd. v. Collector of Central Excise, Patna (1983 E.L.T. 1866).

2. The following facts will set out the controversy to be decided by this Bench :-

The appellants manufacture "slagwool Resin Bonded Slagwool" in their factory at Durgapur. These products are insulation material and are used for conservation of Thermal Energy. The process of manufacture is that the slag, which is a refuse separated from the metal (steel) in the process of melting, is mixed with fluxing agents like lime-stone etc. The mixed metal is melted in a cupila with hard coke. After the slag is melted, the material comes out at the bottom of the cupila and below the belt, there is a centrifugal disc, which throws the metal into atmosphere. Due to velocity of w