Commnr. Of Central Excise, Mumbai vs M/S. National Organic Chemical ...

The Supreme Court examined the applicability of Exemption Notification No. 217/86 CE under the Central Excise Tariff Act, 1985, specifically regarding the captively consumed ethylene and propylene used in manufacturing products under chapters 27 and 29. The Court held that while ethylene and propylene used in the manufacture of goods under chapter 29 are exempt from excise duty, those used for products under chapter 27 are not exempt and thus attract duty. Consequently, the demand for excise duty on the inputs used for chapter 27 products was upheld, affirming the show-cause notices issued to the respondent assessee.