Classification of manufacturing scrap turned on proof of non-melting use; steel waste was classified under the correct tariff heading.

Scrap generated during manufacture of metal containers from steel sheets was held classifiable as waste and scrap of steel under Chapter Heading 7203.20. The Department's attempt to place it under Chapter Heading 7212.90 failed because it relied only on a presumption that the scrap could be used otherwise than for melting. No evidence was produced on the scrap's dimensions, width, or any actual non-melting use by purchasers, so the burden to support classification under the heading for material capable of other use was not discharged. Classification under Chapter Heading 7212.90 was therefore not sustainable, and consequential relief followed.

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Issues: Whether the scrap arising in the course of manufacture of metal containers was classifiable under Chapter Heading 7212.90 or Chapter Heading 7203.20.

Analysis: The scrap was generated during manufacture from steel sheets used as inputs for making metal containers and was admittedly dutiable. The Department relied on a presumption that the scrap was capable of use otherwise than melting, but no material was produced to show its dimensions, width, or any actual non-melting use by purchasers. In the absence of evidence, the burden to justify classification under the heading for material capable of other use was not discharged.

Conclusion: The scrap was classifiable as waste and scrap of steel under Chapter Heading 7203.20, and classification under Chapter Heading 7212.90 was not sustainable. The appeal was allowed with consequential relief.

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