Rubber tyre scrap classification: bead wire and bead wire rings are treated as rubber waste, not metal scrap.

Scrap rubberised bead wire and bead wire rings removed from cut tyres are classified as waste and scrap of rubber products under sub-heading 40.04, not as metal waste and scrap under sub-heading 72.04. Note 6 to Chapter 40 applies where the scrap arises from the manufacture or working of rubber and rubber goods, while Note 6 to Section XV covers metal waste and scrap arising from metal manufacture or mechanical working. Because tyres are rubber products and the embedded steel wire does not change the character of the scrap, the material remains rubber tyre scrap for tariff purposes.

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Issues: Whether scrap rubberised bead wire and bead wire rings removed from cut tyres are classifiable under heading 40.04 as waste and scrap from the manufacture of rubber and rubber goods, or under heading 72.04 as waste and scrap from the manufacture or mechanical working of metal and metal goods.

Analysis: Note 6 to Chapter 40 treats waste, parings and scrap as rubber waste arising from the manufacture or working of rubber and rubber goods, whereas Note 6 to Section XV applies to metal waste and scrap arising from the manufacture or mechanical working of metal and metal goods. The appellants manufacture tyres, which are rubber products, and the rubberised bead wire is used in that manufacturing process. Scrap arising from that process is therefore rubber waste and cannot be treated as metal scrap merely because steel wire is embedded in rubber. Likewise, bead wire rings removed from defective cut tyres remain part of rubber tyre scrap and do not arise from the manufacture or mechanical working of metal.

Conclusion: Scrap rubberised bead wire and bead wire rings removed from cut tyres fall under sub-heading 40.04 of the Central Excise Tariff and not under sub-heading 72.04.

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