Eggshell powder exemption as food-industry waste supported waiver of pre-deposit and stay of recovery.

Eggshell powder cleared from egg-powder manufacture was treated as waste from a food industry product and, on the stated facts, fell within the exemption for waste from food industries under Notification No. 23/2003-C.E. The reasoning linked the eggshell residue to the manufacture of egg powder and noted that the condition of manufacture wholly from indigenous raw materials was satisfied, as there was no allegation of imported eggs. On that basis, the text records a strong prima facie case for exemption and consequent waiver of pre-deposit with stay of recovery in favour of the assessee.

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Issues: Whether eggshell powder cleared by the assessee was eligible for exemption as waste from food industries under Notification No. 23/2003-C.E. dated 31-3-2003, and whether waiver of pre-deposit and stay of recovery were warranted.

Analysis: The activity involved manufacture of egg powder, from which eggshell emerged as waste and was cleared as powdered material. The notification granted total exemption to waste from food industries falling under any chapter of the CETA Schedule. Eggs, being the raw material for the manufacture of egg powder, connected the resultant eggshell waste to a food industry product. The condition requiring manufacture wholly from indigenous raw materials was also satisfied on the facts, as there was no case that imported eggs were used. On this basis, the appellants established a strong prima facie case for the exemption claim.

Conclusion: The eggshell powder was held to be eligible for the claimed exemption, and waiver of pre-deposit with stay of recovery was granted in favour of the assessee.

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