Reprocessed plastic waste exemption upheld for recycled agglomerate manufactured in India and cleared from an export unit.

Plastic agglomerate made by re-processing plastic waste and scrap in an Indian 100% Export Oriented Undertaking was treated as eligible for exemption under Notification No. 5/98-C.E. The exemption applied where the goods fell within Chapter Headings 39.01 to 39.14 and the re-processing was carried out in India, including within the EOU unit. The note also records that an earlier decision between the same parties had accepted the same product for exemption and that the Revenue's circular had already been struck down by High Courts. The stated effect is that the exemption conditions were satisfied and relief was maintained.

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Issues: Whether plastic agglomerate (recycled) manufactured in a 100% Export Oriented Undertaking from plastic waste and scrap and cleared to the Domestic Tariff Area was entitled to exemption under Notification No. 5/98-C.E. dated 2-6-98.

Analysis: The exemption under Sr. No. 63 depended on the goods being classifiable under Chapter Headings 39.01 to 39.14 and being manufactured by re-processing plastic waste and scrap in India. The goods were admittedly manufactured from plastic waste and scrap falling under Chapter 39, and the re-processing was carried out in the respondents' unit located in India. The Tribunal also noted that an earlier decision between the same parties had already held that the same recycled plastic agglomerate was eligible for the exemption and that the Board's circular relied on by the Revenue had been struck down by the High Courts.

Conclusion: The respondents satisfied the conditions for exemption and were entitled to the benefit of Notification No. 5/98-C.E. dated 2-6-98.

Final Conclusion: The Revenue's challenge failed and the order granting relief to the assessee was maintained.

Ratio Decidendi: Where the exemption notification requires re-processing in India, the condition is satisfied if the recyclable plastic waste and scrap are re-processed in a unit located in India, including a 100% Export Oriented Undertaking, and the goods otherwise answer the prescribed tariff description.

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