2016 (8) TMI 938

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....and other packing materials in which oil/grease, dyes and chemicals had been received and waste and scrap of electrical fittings / pipe fittings accessories, tubelight choke, comber spares, mechanical parts of ring frame can be fairly stated as arisen in the course of production processing or in connection therewith and therefore impugned duty is chargeable in terms of Notification No. 22/03-CE dated 31.03.2003 and the extended period is also invokable as there was willful misstatement/ suppression of facts. 2. The Ld. Advocate for the appellant contended that (i) The appellant did not receive any packing material duty free and the waste scrap of packing material pertains to the packing material which was readered useless after ....

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....ayment of duty on waste and scrap which arise out of  production, manufacture, processing or packaging of the goods by using the material received duty free under that Notification. It is a fact that the appellant did not receive the packing material out of which the waste and scrap arose duty free. Indeed the waste and scrap of the packing material is of the packing material in which the duty free inputs were received and therefore cannot be said that such waste and scrap arose as a result of processing of the inputs received duty free. Supreme Court in the case of CCE vs West Coast Industrial Gases Ltd. (supra) held that drums/ barrels in which the calcium carbide is received by manufacturer could not be treated to be a waste arising....

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.... the excisable goods which were brought duty free were not used for the prescribed purposes. We also find substance in the contention of the appellant that there is not even an iota of evidence cited with regard to willful misstatement/ suppression of facts in as much as the SCN merely states as under: "5. The Noticee has not maintained any separate records for waste/scrap generated from imported material and indigenous material. Since no separate records was maintained, hence it cannot be confirmed whether the waste and scrap of indigenous or imported material was cleared of the entire scrap/ waste are to be treated as generated out of imported material, on which a higher rate of duty is applicable. 6. In this regard, the....