Silver strip remnants were not waste and scrap; their intrinsic value preserved exemption eligibility.

Punched remnants of silver strips retained after fabrication were held not to be waste and scrap under sub-heading 7101.80 because they had merely lost their strip form, not their purity or intrinsic value. As the remnants could be remelted and rerolled into silver strips and still remained marketable pieces of silver, they did not satisfy the ordinary meaning of scrap as material of little or no value. On that basis, the exemption under Notification No. 53/86 remained available, since the goods were not correctly classifiable as waste and scrap.

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Issues: Whether the punched remnants of silver strips retained by the assessee after fabrication of components were classifiable as waste and scrap under sub-heading 7101.80 and, if so, whether the assessee was disentitled to exemption under Notification No. 53/86.

Analysis: The disputed material consisted only of punched silver-strip remnants which had lost their original shape as strips but had not lost purity or intrinsic worth. The remnants were capable of being remelted and rerolled into silver strips again, and in market terms remained pieces of silver rather than waste having little or no value. On that basis, the material did not answer the common understanding of scrap and could not be treated as waste and scrap merely because it had been punched and returned for reprocessing.

Conclusion: The remnants were not classifiable as waste and scrap under sub-heading 7101.80, and the assessee was entitled to the exemption.

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