TaxTMI 
TaxTMI 
2014 (8) TMI 400
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....ly. The issues involved in both the Appeals are common, hence, taken up together for disposal. 2. Briefly stated the facts of the case are that the Appellant, M/s Eveready Industries India Ltd., are engaged in the manufacture of Projector Arc Carbon, Dry Cell Electrodes and Industrial Electrodes falling under Chapter Sub-heading No.8545.00. During the course of manufacture of the said finished excisable goods, rejected waste material are generated, viz. waste/scrap, baked, unbaked, black carbon (broken & harrered/crushed), cuts, copper coated etc. The Department has issued demand notice on the clearance of said waste and scrap alleging that the said waste & scrap attract Central Excise duty and also, it has been alleged that they had fai....
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....age of extrusion of Arc Carbon before it reaches the finished stage. He submitted that these scraps are technically not reusable and are hammered & broken into small bits before disposal and the other kinds of waste and scrap are collected after daily sweeping of floor, which usually comprises of bits and pieces of wood, carbon dust, nuts and screws and such other rubbish, which cannot be used in any manner and disposed of as scrap to scrap vendors. He submitted that the waste and scrap cannot be considered as excisable goods. In support of his submission, he has referred to the following judgements of the Hon'ble Supreme Court: (i) Union of India Vs. Indian Aluminium Company Ltd.: 1995 (77) ELT 268 (SC); ....
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....hat during the material time, waste and scrap of carbon were covered under Heading 28.03 of CETA, 1985 and the demand ought to have been confirmed. 7. We have carefully considered the submissions from both sides. We find that the ld. Commissioner (Appeals) in his order dated 09.01.2007, has observed as under: "6. I have carefully gone through the records of the case and submissions made thereof. Here, the issue involved is whether waste/scrap broken and hammered black carbon can be treated as defective arc-carbon under Tariff Sub-heading No.8545.00 and Central Excise duty, can be levied ipso-facto on such clearances of waste/scrap. The Adjudicating Authority viewed in both 1st & 2nd order that the appellants resorte....
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....hing the pieces of the prima products. Following the decision of Apex Court in the case of U.O.I Vs Delhi Cloth and General Mills Co. Ltd. - 1997 (92) ELT 315 (SC) and U. O. I. Vs. J. G. Glass Industries Ltd. - 1998 (97) ELT 5 (SC), it becomes a settled issue of law that Central Excise duty is leviable on the goods in the form they are at the time they leave the factory gate. The subject goods at the point of clearances are in broken, hammered, crushed waste/scrap form and accordingly they should be treated as waste/scrap. Views taken by the adjudicating authority to classify such waste/scrap under Tariff Sub-Heading No.8545.00 is erroneous as is evident from the Explanatory Notes to Harmonized Commodity Description gi....
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....or refuse or by-product is exempted from whole of the duty of excise leviable thereon or chargeable to nil rate of duty or is not specified as final product under Rule 57A". Issue of Board's Circular No.B4/7/2000-TRU dated 03.04.2000 reflected the same view and this clinched the issue in favour of the appellants. 6. Considering my discussion supra, I set aside the impugned 1st & 2nd Order and allow the appeals. Both the appeals stand disposed of." 8. In the subsequent order dated 27.07.2007, the ld. Commissioner (Appeals), has recorded a different finding that the defective goods are Arc carbon which were later hammered/crushed to convert into waste and scrap and removed from the factory without payment of duty.....