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of <h1>Tribunal rules in favor of appellants, setting aside duty demand on used nuts & bolts as waste & scrap (2)</h1> The Tribunal ruled in favor of the appellants, setting aside the duty demand on used nuts and bolts cleared as waste and scrap between May 2000 and ... Demand - Cenvat/Modvat Issues involved: Determination of duty on used nuts and bolts cleared as waste and scrap during a specific period.Analysis:The short issue in the appeal was whether duty was payable on used nuts and bolts cleared as waste and scrap between May 2000 and September 2000. The Assistant Commissioner had confirmed a duty demand of Rs. 93,019 along with a personal penalty on the appellants. The Commissioner (Appeals) upheld this decision citing Rule 57S(2)(c) as the basis for the duty liability due to the appellants initially taking Modvat credit for the nuts and bolts.The appellants challenged the order, arguing that the demand under Section 11A treated them as manufacturers of the waste and scrap, which was beyond the scope of the show cause notice. They also contended that Rule 57S(2) was not applicable during the relevant period as it had been replaced by new Modvat rules. The appellants asserted that referring to a rule that was not in effect during the relevant period was unjustified.Upon hearing the arguments, the Tribunal agreed with the appellants' contentions. It noted that Rule 57S(2) was not in effect during the relevant period, and the new rules did not impose a duty on capital goods at the time of clearance as waste and scrap. Therefore, the Tribunal set aside the impugned order, allowing the appeal and providing consequential relief to the appellants.In conclusion, the Tribunal ruled in favor of the appellants, emphasizing that the duty demand based on Rule 57S(2) was not applicable due to its non-existence during the relevant period. The decision highlighted the importance of aligning duty liabilities with the rules in force during the relevant time frame to ensure fair and lawful imposition of duties on cleared goods.
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