TaxTMI 
TaxTMI 
2017 (7) TMI 443
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....vision receivers on payment of duty as scrap materials. A Show cause notice was issued alleging that since credit had been availed on inputs the respondents ought to have reversed the credit under Rule 3 (4) of Cenvat Credit Rules, 2002. The respondents filed a detailed reply contenting that they had not removed the inputs as suchand had only removed the waste components that are arising during the production. After due process of law, the original authority observed that the show cause notice is silent on the aspect whether the goods cleared are inputs as such or they are partially processed and waste/scrap. As the dispute pertained to facts, he called for verification by the jurisdictional Assistant Commissioner whether the goods removed ....
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.... V. Panchanathan appearing for the respondents adverted to the reply to the show cause notice issued by the respondents. He submitted that on perusal of Annexure-A itself, it can be seen that the goods are nothing but waste PCB assemblies, rejected/defective components, broken picture tubes, waste and defective components of television etc. The respondents being manufacturers of television and components of television, during the production of PCB assemblies, some of them become waste due to human error of over soldering of PCB units and sometimes these components gets burned. In that situation PCB assemblies rejected and some important costly components are salvaged and further used in the production. All these were set out in detail in th....
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....transaction is limited to the invoice price and as allege in the SCN that we should have paid. It is submitted that the production waste which looks a like a input but it cannot be equated with the a fresh and quality inputs because they are failed/burned/broken in the production hence those are declared as waste. It is known fact that in case the waste is useful to our production certainly they are salvaged instead of procuring the fresh material from the market by spending valuable fund. The fresh inputs are accounted in the stores inventory and in case they are removed as such the appropriate duty has been discharged by us. The waste during the production is accounted in waste register and RG-1 and they are disposed off at the price of....