Binding Larger Bench precedent governed treatment of reusable plastic remnants, supporting waiver of pre-deposit and stay of recovery.

Plastic offcuts and remnant pieces generated in manufacture and sent to job workers for crushing and return for reuse were treated, for pre-deposit and stay purposes, as governed by the binding Larger Bench view in Wyeth Laboratories Ltd. That ruling supported the manufacturer's option to proceed under the relevant rule covering reusable waste or scrap, rather than treating the remnants as duty-liable waste outside that provision. Following that precedent, the Tribunal granted waiver of duty and penalty pre-deposit and stayed recovery pending final disposal.

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Issues: Whether, for the purpose of waiver of pre-deposit and stay of recovery, the assessee's plastic offcuts and remnant pieces sent to job workers for crushing and return for reuse in manufacture were covered by Rule 57F(4), or were liable to duty as waste and scrap under Rule 57F(2).

Analysis: The applicant manufactured ABS plastic luggage and generated offcuts and remnant plastic pieces in the course of manufacture. These were sent without payment of duty to job workers for crushing and return for reuse. The demand proceeded on the view that such remnants were waste and scrap and therefore outside Rule 57F(4). However, the decision of the Larger Bench of the Tribunal in Wyeth Laboratories Ltd. had held that metal waste removed for remelting into ingots to be reused in the factory was covered by both Rule 57F(2) and Rule 57F(4), leaving the manufacturer with an option to adopt either course. The Tribunal noted the departmental objection that the Larger Bench view required reconsideration, but held that it remained bound by that decision at the stage of the present application.

Conclusion: The assessee was entitled to waive deposit of the duty and penalty, and recovery thereof was stayed.

Final Conclusion: Interim relief was granted in favour of the assessee on the basis that the larger bench ruling governed the treatment of the disputed remnants pending final disposal.

Ratio Decidendi: Where a binding Larger Bench decision covers the classification or treatment of goods for the limited purpose of pre-deposit and stay, the Tribunal must follow that decision and grant interim relief accordingly.

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