M/S. COASTAL PAPER LTD. vs COMMNR. OF CENTRAL EXCISE, VISAKHAPATNAM

The Supreme Court examined Notification No. 22/94-CE dated 01.03.1994, which provides a concessional excise duty rate of 5% for paper made from non-conventional raw materials, specifically requiring that the pulp contains at least 75% of materials other than bamboo, hardwoods, softwoods, reeds, or rags. The Court held that pulp made from waste gunny bags and jute waste does not fall under the category of 'rags' as defined in the Notification, thereby entitling the appellant to the concessional rate of duty. The judgment clarifies the interpretation of 'rags' in the context of the Notification, favoring the assessee's claim for reduced excise duty.