Job-work treatment for plastic waste and scrap converted into granules supported notification benefit and defeated duty demand.

Plastic waste and scrap generated in manufacture, when sent to a job-worker for conversion into granules and received back for use in the manufacturing process, was treated as covered by Notification No. 214/86-CE. The factual arrangement of dispatch to the job-worker and return of the processed material supported application of the notification, and the mere character of the material as waste and scrap did not exclude it from job-work treatment. On that basis, the duty demand was held not sustainable and the Revenue's challenge failed.

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Issues: Whether waste and scrap generated during manufacture and sent for conversion into granules under Notification No. 214/86-CE could be treated as eligible goods for job-work so as to negate the duty demand.

Analysis: The facts found by both lower authorities were that the plastic waste and scrap generated in the course of manufacture was sent to a job-worker, converted into granules, and received back for use in the manufacturing process. The Notification was applied in the context of goods manufactured on job-work basis for use in or in relation to manufacture of final products. On the established factual matrix, the dispatch and return of the material was held to justify the arrangement, and the Revenue's objection that the notification could not apply merely because the material was waste and scrap was rejected.

Conclusion: The duty demand was not sustainable and the Revenue's appeal failed.

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