Marketable waste and scrap from manufacture remain dutiable, and remission is unavailable when by-products are regularly sold.

Waste and scrap arising during manufacture of glass bottles, including plastic film pieces, empty bags, paper tubes and turning waste, were treated as dutiable and excisable because they emerged in the course of manufacture, were marketable and were regularly sold under commercial invoices; remission of duty under Rule 21 was therefore not available. Used or burnt lubricating oil collected from machines was likewise regarded as dutiable waste arising in manufacture, and a contrary later view could not be sustained. The effect was that remission was rejected and the original order refusing relief was restored.

---

---

Issues: (i) whether the waste products arising in the course of manufacture of glass bottles were excisable and marketable so as to deny remission of duty under Rule 21 of the Central Excise Rules, 2001; (ii) whether used or burnt lubricating oil collected from machines was liable to duty and the contrary view of the appellate authority could be sustained.

Issue (i): whether the waste products arising in the course of manufacture of glass bottles were excisable and marketable so as to deny remission of duty under Rule 21 of the Central Excise Rules, 2001.

Analysis: The waste items, including plastic film pieces, empty plastic bags, waste paper tubes, paper waste, turning waste and similar scrap, had already been held in the assessee's own case to be dutiable and excisable because they emerged during manufacture, were marketable and were regularly sold under commercial invoices. The later appellate order taking a contrary view could not stand in the face of the earlier binding finding upheld by the Tribunal. Since the conditions for remission were not satisfied, the rejection of remission was justified.

Conclusion: The issue was decided against the assessee and in favour of Revenue.

Issue (ii): whether used or burnt lubricating oil collected from machines was liable to duty and the contrary view of the appellate authority could be sustained.

Analysis: The used lubricating oil was treated by the appellate authority in another case as having been correctly subjected to duty. On the same principle, the contrary view taken in the impugned order could not be sustained, as the material was regarded as dutiable waste arising in the course of manufacture and not exempt from duty merely because it was described as used oil.

Conclusion: The issue was decided against the assessee and in favour of Revenue.

Final Conclusion: The appeal succeeded, the appellate order granting remission was set aside, and the original rejection of remission was restored.

Ratio Decidendi: Waste and scrap arising in manufacture, if marketable and regularly sold, are dutiable and cannot be treated as entitled to remission under Rule 21 merely because they are by-products or waste; a contrary later view cannot prevail over an earlier consistent determination in the same assessee's case.

---