1. This is a Revision Application to the Government of India which, under Section 35F of the Central Excises and Salt Act, '1944, has been, transferred to the Tribunal for being disposed of as if it-were an appeal presented before it, 2. The dispute calling for a decision in. the present case is a simple one turning on the excisability or otherwise of gold produced by the appellant firm from out of gold bearing ore mined by them. The Assistant Collector of Central Excise, Bellary held that the gold fell under Item 68 of the 1st Schedule to the Central Excises and Salt Act (hereinafter referred to as Central Excise 'Tariff -CET for short) and was liable to be charged to duty at the appropriate rate. On appeal the Appellate Collector upheld, the Assistant Collector's order.
3. The appellants' contentions right through the proceedings from the stage of refund claim to the stage of the present proceedings is that Item 68 of the CET applied only to goods manufactured in the factory.
The said tariff item contained an explanation at the relevant level which, is reproduced below :- "In this item, the expression 'factory' has the meaning assigned to it in Section 2 (m) of the Factories Act, 1948." Now Section 2(m) of the factories Act defines a 'factory' in the following terms :- "...2 (m) 'Factory' means any promise including the precincts thereof- (i) whereon ten or more workers are working or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power, or is ordinarily so carried on, or (ii) whereon twenty or more workers are working or were working on any day of the preceding twelve months and in any part of which manufacturing process is being carried on without the aid of power or is ordinarily so carried on, - but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or..." 4. The contention is that the Hatti Gold Mines is a "mine" falling within the meaning of the Mines Act and, therefore, is excluded from the definition of "factory" contained in Section 2(m) of the Factories Act. In support of this contention the appellants have produced a letter dated 15-2-1977 from the Director of Mines Safety to the Commissioner for Industries and Secretary to Government of Karnataka, Commerce & Industries Department, Bangalore, to the effect that the mill at Hatti Gold Mines wherein recovery of gold and silver from the gold bearing ore is effected is also treated as coming within the purview of the Mines Act, 1952. The appellants have also produced a letter dated 29-3-1977 from the Chief Inspector of Factories and Boilers, Bangalore, to the aforesaid Commissioner and Secretary to the effect that the premises at Hatti where gold is extracted from the gold bearing quartz is not a factory as per the Factories Act, 1948 and that at no time it has been subjected to the operation of the said Act. The appellants' contention that the mill in which gold is recovered from the gold bearing ore is not a factory within the meaning of the Factories Act and that, therefore, the gold produced from there would not attract excise duty under Item 68 of the CET, is tenable. In fact we notice that the Government of India in Revision Order No. 712/79 has accepted the position.
5. Having regard to the foregoing discussion, we set aside the order of the Appellate Collector of Central Excise, Madras and allow the appeal and direct that the consequential relief be granted to the appellant within 60 days from the date of communication of this order.