INDIAN FARMERS FERTILISER COOPERATIVE LTD. vs COLLECTOR OF CENTRAL EXCISE AHMEDABAD.

The Supreme Court addressed the applicability of Exemption Notification No. 187/61 under the Central Excise and Salt Act, 1944, concerning the use of raw naphtha in the manufacture of ammonia for fertilizers. The Court held that the use of ammonia in ancillary processes such as water treatment and steam generation plants is integral to the manufacturing process of fertilizers, thus qualifying for the exemption. However, the use of ammonia in effluent treatment was not deemed integral, leading to a partial upholding of the appeals regarding excise duty demands.