Waste sent for remelting and reconversion into manufacture was not dutiable where further processing was commercially and technologically feasible.

Brass waste and scrap sent for job work, remelting and reconversion into brass rods was not dutiable where the movement was part of further manufacture. The Tribunal applied the Larger Bench ruling in Wyeth Laboratories Ltd. and held that "waste" in the relevant rule has a limited meaning; material arising in manufacture may still qualify as convertible or reusable material if commercial prudence and technological feasibility support reprocessing. On those facts, the goods were being used again in relation to manufacture, so duty could not be demanded merely because they were described as waste.

---

---

Issues: Whether brass waste and scrap cleared for job work and sent for remelting and reconversion into brass rods could be treated as liable to duty, or whether the procedure under the Central Excise Rules permitted such movement without payment of duty.

Analysis: The Tribunal held that the controversy was covered by the Larger Bench decision in Wyeth Laboratories Ltd., which explained that the expression "waste" in the relevant rule has to be understood in a limited sense. Waste, refuse or by-products arising in manufacture may still be treated as convertible material where commercial prudence and technological feasibility justify further processing, reconversion or reprocessing. On that reasoning, the brass waste and scrap sent out for job work to be remelted and reconverted into brass rods could not be treated as dutiable merely because it was described as waste, since the goods were being used again in relation to manufacture.

Conclusion: The brass waste and scrap was not liable to duty on the facts found, and the appeal succeeded.

---