NASIR-UL-MULK, C.J.---The Army Welfare Trust Nizampur Cement Plant (respondent herein), had supplied cement in huge quantities from 16-9-1998 to 7-5-1999 to Ghazi Barotha Project for the construction of Dam. The appellant paid central excise duty at the rate of Rs.40% under S.R.O.
456(1)/96, dated 13-6-1996. On the report of Deputy Director, Director General of Intelligence and Investigation (Customs and Central Excise), Peshawar, the Additional Collector Customs, issued show-cause notice to the respondent on 31-5-1999 stating that the cement so sold was liable to central excise duty at the rate of 70% under S.R.O. 455(1)/96, dated 13-6-1996 as amended by S.R.O.
902(1)/98, dated 27-8-1998. The respondent was thus directed to show cause as to why the short levy amounting to Rs.12,08,477 along with penalty be not recovered from the appellant. The appellant submitted reply to the show-cause notice and questioned the charge of duty under S.R.O. 2155 as amended. The explanation was not accepted and by order in original, dated 30-5- 2000 the Additional Collector held the respondent liable to pay duty as stated in the show-cause notice along with additional duty and penalty equal to 5% of the value involved under section 210 of the Central Excises Act, 1944. On appeal by the present respondent the Customs, Central Excise and Sales Tax Appellate Tribunal, Peshawar Bench reversed the order-in-original and held that the show-cause notice was unfounded. The Collector, Central Excise and Sales Tax Peshawar has filed the present appeal against the judgment and order of the Tribunal, dated 15-6-2002.
2. In order to properly appreciate the contentions of the counsel for the parties it will be worthwhile to briefly refer the relevant provisions of the S.R.Os. Involved in the present litigation S.R.O. 456, dated 13-6-1996 lays down in a list of goods and services on which central excise duty is leviable as well as the rate at which the levy is to be made. Under the heading No.2523.0000 the rate of duty for cement generally has been fixed at 40% of the retail price. The same S.R.O. However excludes from its application goods specified in S.R.O. 455 of the same date. S.R.O. 455 has been subsequently amended by S.R.O. 902, dated 27-8-1998 so as to include cement, "if cleared in loose form in bulk quantities for further use as raw material or intermediary product". The rate of duty for this kind of cement has been fixed at 70% ad volerum. The appellant, that is the Excise Department, claims that the respondent is liable to pay duty at the rate of 70% under S.R.O. 454 as amended by S.R.O. 902 as they had provided cement in loose form in bulk quantities to Ghazi Barotha Project.
The respondents insist that they had rightly paid duty at the rate of 40% under S.R.O. 456.
3. The rate of central excise duty on cement generally is 40% of the retail price under S.R.O. 456. The same S.R.O. Creates an exception of cement falling under S.R.O. 455 as amended by S.R.O. 902. In order to bring the sale of cement under S.R.O. 455, it has to be shown that the cement was sold in loose form in bulk quantities and for use either as raw material or intermediary project. There is no dispute as regards the first condition as the parties agree that the cement was sold by the respondent to Ghazi Barotha Project in loose form and in bulk quantities. The controversy is restricted to the second condition, namely, whether the cement so sold was for the use by'Ghazi Barotha Project as raw material or intermediary products. The learned counsel appearing for the appellant, that is the Department, submitted that since Ghazi Barotha had utilized the cement provided by the respondent for the construction of Dam, the cement was used as raw material for the Construction. That, therefore,. Both the conditions mentioned in S.R.O. 455 for the levy of 70% duty on cement have been satisfied. The learned counsel representing the respondent argued, with reference to the definition of raw material and products as given in Black's Law Dictionary, that the raw material means that material used for the produce of goods. The learned counsel further submitted that if the raw material is given the interpretation put forth by the learned counsel for the appellant, the inclusion of cement in S.R.O. 456 with 40% duty would become meaningless as all cements are eventually put to some further use.
4. Black's Law Dictionary defines raw material as "goods purchased for use in manufacturing a product for example wood, steel". Product has further been defined to mean, inter alia, "goods produced or manufactured either by natural means, by hand, or with tools, machinery, chemicals or the like". The cement which is further used for the manufacture of products could be brought within the meaning of raw A material as used in S.R.O. 555. Intermediary product is a product which is marketable. The cement provided by the respondent to Ghazi Barotha Project was for the purpose of construction and not for the manufacture of goods or articles or an intermediary product. If it is held that cement used in construction would fall within the definition of raw material, the inclusion of cement in S.R.O. 456 would be rendered meaningless as cement is always put to further use. It is the basic principle of construction of statutes that effect is to be given to all statutory provisions so as not render any part redundant.
We, therefore, hold that cement supplied by the respondent to Ghazi Barotha Project during 16-9- 1998 to 7-5-1999 was liable to duty at 40% under S.R.O. 456(1)/96. Agreeing with the findings of the Tribunal we dismiss the Appeal. .