TaxTMI 
TaxTMI 
2019 (4) TMI 1328
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....l Excise Tariff Act, 1985. The respondent purchased various raw materials such as chemicals, rolls, tools, machinery and other electrical equipment. Some of the said inputs were received in wooden containers and/or pallets. The containers formed an inseparable and integral part of the said inputs and did not in and of themselves, possess any separate identity and are not distinctly particularised or charged against the said invoices. After extracting and/or unloading the relevant raw materials required for the purposes of manufacturing, the assessee disposed of the emptied wooden containers and/or pallets as scrap, by selling the same to one or more scrap dealers under cover of invoices describing the same as "scrap wood/broken pallets". Ad....
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....aterials of inputs was concerned, no credit was required to be reversed in view of the Board's Circular No. 721/37/2003-CX dated 6.6.2003. Further it was also submitted that the buyers to whom goods were despatched were encouraged by the assessee to return empty pallet pursuant to there being unpacked and unloaded. Some of these customers would periodically return the said pallet to the assessee for reuse. At the time of receiving the returned pallets no duty was paid. It is his submission that out of the returned pallets some would be in unusable condition and would accordingly get cleared as scrap. The wooden scrap sold by the assessee also included broken/discarded inputs packing materials as well as recycled wooden pallets returned from....
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....ndervalued. Nor was there any allegation that the sales were made to related persons. I find that this price difference weighs heavily against the allegation by the department that the pallets were removed as such. I find that the Appellant has claimed that they had included the value of pallets in the value of finished, for the purpose of paying excise duty, even when such finished goods were packed with recycled/returned pallets on which no CENVAT credit was availed by them. This claim of the Appellant has been vindicated by the certificate dated 19.08.2017 from a Chartered Accountant. M/s. Kunal & Associates. Hence, in view of the aforesaid, I am not inclined to hold that the Appellant had removed pallets as such in the garb of scrap. ....
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.... not required as the utilization of input on which credit has been taken is not in dispute. 3. Accordingly, it is clarified that no duty shall be payable and no reversal of credit is also warranted on waste package/containers used for packing inputs, on which credit has been taken, when cleared from the factory of the manufacturer availing Modvat/CENVAT credit. Consequently, Circular No. 470/36/99-CX dated 19.7.99 may be treated as withdrawn. Pending cases if any, may be decided accordingly." Further, in the case of Commissioner of C.Ex. Panchkular Vs. Ballarpur Industries Ltd., reported in 2014(300) E.L.T. 181(P&H), Hon'ble High Court of Punjab, Haryana & Chandigarh held that 'Plastic Waste', which was a packaging materia....