2016 (8) TMI 234

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....e appellant was required to show cause as to why the said amount of duty should not be demanded alongwith interest and penalties on the ground that during the period March, 1997 to March, 1998 the appellant cleared various items of scrap generated during the course of manufacture of excisable goods without payment of duty. In contravention Rules 91, 52 A, 57 S (2) C, 173 F, 173G and 226 of Central Excise Rules,1944. The Show-Cause-Notice also stated that as per Rule 57 S (2) (c) of Central Excise Rules, where capital goods are sold as waste and scrap the manufacturers shall pay the duty leviable on such waste and scrap but in the instant case the appellant neither indicated any sale in the RT-12 returns nor informed the Department about the....

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....ontravention of Rules, 9 (1), 52A, 57S(2) C, 173F, 173G & 226 of Central Excise Rules, 1944. The value of these goods was Rs. 4820295/- on which the amount of duty involved @ 15% adv. Comes Rs. 7,23,044/-. As per Rule 57S (2) C of Central Excise Rules, 1944 where capital goods are sold as waste & scrap, the manufacturer shall pay the duty leviable on such waste and scrap, but in the instant case, the assessee neither indicated any sale in the R.T. 12 returns nor infomed the department about the sale of scrap of various items. It appears that the assessee had sold the capital goods as waste/ scrap without payment of Central Excise duty in contravention of the provisions of Rule 57S (2) C of Central Excise Rules, 1944." It is evid....

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....eptable because the respondent has failed to produce evidence in their support. On the contrary, the respondent has contended that the waste and scrap has generated during the course of manufacture or during the mechanical working of metals. Then only it will be excisable. Further, contended that Rule 57(F) 18 and Rule 57S (2) (c) of Central Excise Rules, 1944 provided that the duty is leviable on the waste and scrap of inputs and capital goods by treating as if these goods are manufactured in the factory. The necessary test for levy of duty was that such waste and scrap must find entry in the tariff. If the waste and scrap of any particular tariff is not appearing in the particular chapter such waste and scrap will not be chargeable to any....