1989 (11) TMI 180

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....roforma credit in respect of the inputs which were contained in the cut tubes and tyres found defective on manufacture and cleared under Tariff Item 68 of the Central Excise Tariff. The learned Collector (Appeals), however, set aside the lower authority's order for the reasons recorded in his order and reproduced below for convenience of reference: "I find that in view of his contention and in view of Explanation to sub-rule (2) of rule 56-A, though cut tubes and defective tubes, cut and cleared for purpose of only nil rate of duty, the same cannot be considered goods for the manufacture of which butyl rubber has been used by the appellants. Appellants has used such rubbers only for manufacture of tubes. But due to reasons beyond their c....

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....has to be there. Read with sub-rule (b) of clause (iv) which lays down that no part of credit shall be utilised same as provided in sub-rule (a) or shall be refunded in cash or by cheque, proforma credit utilisation in respect of payment of duty on waste is prohibited under the Rules. 2. The Collector of Central Excise (Appeals) also grossly erred in holding that cut tyres and cut tubes are not goods. They are goods chargeable to excise duty but are exempted from whole of duty leviable thereon under a Notification issued under Rule 8(1) of Central Excise Rules, 1944 they are classifiable. 3. The question whether a particular material is a waste or a finished excisable goods is one of the fact to be determined taking into consideration....

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....redit in terms of Rule 57D(1). Rule 57D(1) for convenience of reference is reproduced below: "RULE 57D. Credit of duty not to be denied or varied in certain circumstances. - (1) Credit of specified duty allowed in respect of any inputs shall not be denied or varied on the ground that part of the inputs is contained in any waste, refuse, or by-product arising during the manufacture of the final product, whether or not such waste, refuse or by-product is exempt from the whole of the duty of excise leviable thereon or is chargeable to nil rate of duty or is not specified as a final product under Rule 57A." 5. The learned J.D.R. conceded that explanation to sub-rule (2) of Rule 56A and the provisions of Rule 57D(1) are identical in nature....