TaxTMI 
TaxTMI 
2013 (8) TMI 680
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....orkshop itself. The old and worn out parts of the machinery and also the scrap generated in the course of fabrication of parts of the machinery was being sold by the appellant without payment of duty. The department was of the view that this scrap was chargeable to central excise duty. On this basis, a show cause notice dated 16-4-1999 was issued to the appellant for demand of duty amounting to Rs. 2,09,109/- in respect of the clearances of M.S. Scrap during 1995 to 1997-98 period along with interest thereon under Section 11AB of Central Excise Act, 1944 and also for imposition of penalty on the appellant under Section 11AC ibid. This show cause notice was adjudicated by the Asstt. Commissioner vide order-in-original dated 27-7-1999 by whic....
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....e appeal on merits ex parte vide Final Order No. 45/2002-B, dated 16-1-2002 [2002 (141) E.L.T. 490 (Tri. - Del.)] by which the appeal was dismissed. The Tribunal while dismissing the appeal observed that duty has been demanded only in respect of the scrap generated in the workshop of the appellant and which had been cleared without payment of duty and that no duty has been demanded in respect of the old and worn out machinery or machinery parts, no longer useable and which had been sold as scrap. The appellant filed an application for restoration of this appeal on the ground that the order was ex parte. The appellant filed Misc. Application No. 33/2002 for restoration of the appeal. It appears that this application was not listed for about ....
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....has been upheld by the Commissioner (Appeals), that scrap generated in the workshop for making parts of the machinery for replacing the old and worn out parts is chargeable to central excise duty, as held by Hon'ble Rajasthan High Court in the case of Grasim Industries Ltd. reported in 2008 (229) E.L.T. 328 (Raj.) and that in view of this, there is no infirmity in the impugned order. 6. We have carefully considered the submissions from both the sides and perused the records. 7. On going through the order-in-original passed by the Asstt. Commissioner and order-in-appeal passed by the Commissioner (Appeals), we find that the appellant's plea that the entire scrap cleared was in form of old and un-useable machinery or parts thereof, and not ....
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....ss or a byproduct of manufacturing process and hence the same is not excisable. In this regard, paras 14, 15 and 16 of the Apex Court judgment are reproduced below :- "14. In the present case, it is clear that the process of repair and maintenance of the machinery of the cement manufacturing plant, in which M.S. scrap and Iron scrap arise, has no contribution or effect on the process of manufacturing of the cement, which is the excisable end product, as since welding electrodes, mild steel, cutting tools, M.S. Angles, M.S. Channels, M.S. Beams etc. which are used in the process of repair and maintenance are not raw material used in the process of manufacturing of the cement, which is the end product. The issue of getting a new identit....