Per: K.S. Venkataramani: The appellants herein manufacture chlorine and trichloriethylene. They availed MODVAT Credit on Sulphuric Acid classified under Sub-Heading 2802.20 CETA, 1985 as an input used for drying Acetylene and Chlorine in the manufacture of their final product. The concentrated Sulphuric Acid after use in the plant becomes diluted and comes out of the plant and is then known as spent sulphuric acid with a concentration of 60% to 65%. The Department found that the appellants apart from disposing the spent sulphuric acid as waste by allowing it to mix with sand and mud, were also selling it to industrial consumers. The acid that is sold is stored in carbuoy and steel tanks and is sold periodically on the basis of contracts without payment of excise duty and without following the prescribed procedure. By as how cause notice issued on 27.8.88 duty of Rs. 15,947.07 was demanded on the spent sulphuric acid without payment of duty for the period from 1.3.86 to 27.11.86. It was alleged that duty becomes payable on the spent sulphuric acid in terms of Rule 57F (4) (a) of Central Excise Rules according to which any waste arising from the processing of inputs on which MOD