TaxTMI 
TaxTMI 
2013 (12) TMI 977
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....ied drinking water. The said product is supplied in polycarbonate bottles which are returnable and re-usable with a shelf life of around 50 cycles. The appellant avails CENVAT credit of the Excise duty paid on such bottles. After a few cycles, these bottles get damaged and cannot be used further for packing of the finished goods. Such bottles are cut into pieces and sold by the appellant to dealers in waste and scrap. 2.1 During February 2001, the appellant sold 8320MTs of such bottles as scrap valued at Rs.3,55,500/-. The department was of the view that the appellant has manufactured plastic scrap and, therefore, duty is demandable and accordingly quantified a duty demand of Rs.56,880/-. 2.2 The appellant also keep three bottles of t....
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....e Central Excise Rules, 1944. Aggrieved of the same, the appellant preferred an appeal before the lower appellate authority who dismissed their appeal. Hence the appellant is before us. 3. The learned Counsel for the appellant made the following submissions. 3.1 The appellant is not a manufacturer of plastic scrap as alleged in the impugned order. After usage of the plastic bottles repeatedly, the bottles get damaged and is no longer usable. Therefore, they sold it as scrap to the dealers in such products and by no stretch of imagination the appellant can be treated as a manufacturer of plastic scrap. Reliance is placed on the decision of the tribunal in the case of VVF Ltd. vs. Commissioner of Central Excise, Daman 2009 (248) ELT 593....
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....erefore, the appeal be allowed. 4. The learned Additional Commissioner (AR) appearing for the Revenue on the other hand contends that the appellant has cut the bottles into four pieces before disposing it of as scrap. It is out of the cutting of the bottles that the scrap has come into existence and, therefore, the appellant can be construed as 'manufacturer' of plastic scrap. 4.1 As regards, the control samples drawn by the appellant from each batch of production, the appellant has not maintained any kind of records to show that these controlled samples were either tested or got consumed during the process of testing. In the absence of any records, the only conclusion is that the appellant has cleared the goods without payment of dut....
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....ratio of these decisions applies with equal force to the facts of the present case. The waste has arisen either on account of damage of the bottles during the process of use or the plastic bottle has been scrapped after use of the bottles in50 cycles. If by continuously using an item, the said item becomes a scrap, it cannot be said that the so-called waste is a manufactured product. Therefore, we agree with the contention of the appellant that they have not manufactured any waste and scrap of plastics and, therefore, the demand in this regard is not sustainable in law. 5.3 As regards the demand on control samples of purified water, it is an admitted position that the samples had been drawn as per the norms fixed by the Food and Drugs au....