SOUTH BIHAR SUGAR MILLS LTD., ETC. vs UNION OF INDIA & ORS.

The Supreme Court held that the gas generated by the appellant companies was kiln gas and not carbon dioxide as recognized in trade, thus not liable for excise duty under Item 14-H of the Central Excise and Salt Act, 1944. The Court emphasized that the mixture of gases produced did not meet the market specifications for carbon dioxide, which requires a minimum purity of 99%. Consequently, the excise duty imposed was invalid as it was based on a misclassification of the product.