SSI exemption for waste and scrap upheld where the notification did not bar its application within the threshold.

Notification No. 41/2001-CE (N.T.) was held not to bar SSI exemption on waste and scrap cleared by the manufacturer where the assessee remained within the SSI threshold. The analysis followed the assessee's earlier case, which had already concluded that the notification did not exclude such waste and scrap from SSI benefit. On that binding view, the duty demand on waste and scrap was not sustainable and the issue was decided in favour of the assessee.

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Issues: Whether duty could be demanded on waste and scrap cleared by the manufacturer on the footing that Notification No. 41/2001-CE (N.T.) did not bar availment of SSI exemption on such waste and scrap.

Analysis: The dispute was already concluded in the assessee's own case. The earlier decision had held that Notification No. 41/2001-CE (N.T.) contained nothing to deny the benefit of the SSI Notification in respect of waste and scrap, and that where the assessee remained within the SSI threshold, the exemption continued to apply to such waste and scrap. Following that binding view, the demand could not survive.

Conclusion: The demand of duty on waste and scrap was not sustainable and the issue was decided in favour of the assessee.

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