Manufacturing scrap is governed by the specific waste rule, so duty-free clearance depends on a valid order covering that scrap class.

Scrap generated during manufacture was held to fall under the specific waste provision, not the general rule permitting removal of inputs as such or after partial processing. Rule 57F(2) did not authorise duty-free clearance of manufacturing scrap, because waste arising in production is governed by Rule 57F(4), which allows removal on payment of duty, duty-free removal only where a valid governmental order specifies the relevant class of waste, or destruction under prescribed conditions. Duty-free clearance was therefore available only to the extent aluminium scrap was covered by the trade notice; brass and zinc scrap, being unsupported by any corresponding order or notification, remained dutiable.

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Issues: Whether scrap generated during the course of manufacture could be removed without payment of duty under Rule 57F(2), and whether duty-free clearance was permissible only to the extent covered by Rule 57F(4).

Analysis: Rule 57F(2) permitted removal of inputs as such or after partial processing for specified purposes. Scrap arising during manufacture was not itself an input or a partially processed input, but waste generated in the course of production. Such waste was specifically governed by Rule 57F(4), which provided that waste arising from processing of inputs may be removed on payment of duty, removed without payment of duty only where covered by a class or category specified by the Central Government, or destroyed under prescribed conditions. The trade notice could support duty-free removal only to the extent it covered aluminium scrap, but no corresponding order or notification existed for brass and zinc scrap.

Conclusion: Removal of scrap without duty under Rule 57F(2) was not permissible; scrap not covered by an order under Rule 57F(4)(b) had to suffer duty. The assessee succeeded only for aluminium scrap covered by the trade notice, but failed for brass and zinc scrap, and the Revenue's appeal was allowed.

Ratio Decidendi: Waste arising during manufacture is governed by the specific scrap provision and cannot be cleared duty-free under the general input-removal provision unless it is covered by a valid governmental order specifying that class of waste.

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