TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 618
X X X X Extracts X X X X
X X X X Extracts X X X X
....waste and scrap' arising during the course of manufacture of 'insulated electrical wires and cables' are also liable to duties of central excise. It was held that the said goods are products of 'manufacture', and hence liable to duty under section 3 of Central Excise Act, 1944, and 'excisable' owing to coverage by specific headings in the Schedule to Central Excise Tariff Act, 1985 besides being 'marketable' as evinced by sale in the market. 2. According to Learned Counsel for the appellant, they had been discharging duty liability on these 'waste and scrap' against relevant tariff line below heading 8544 in Schedule to Central Excise Tariff Act, 1985, and only for abundant caution, after insertion of 'Explanation - For the purpose of this clause, "goods" includes any article, material or substance which is capable of being bought and sold for a consideration and such goods shall be deemed to be marketable.' below definition of 'excisable goods' in section 2(d) of Central Excise Act, 1944 with effect from 10th May 2008 which was intimated vide letter dated 18th June 2008 as also discontinuance of payment of duties vide 17th March 2011. It was also pointed out that proceedings w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ugar Ltd [2015 (322) ELT 769 (SC)] and he submitted that like finding of the Hon'ble High Court of Bombay in Hindalco Industries Ltd v. Union of India [2015 (315) ELT 10 (Bom)] was affirmed by the Hon'ble Supreme Court. Learned Authorized Representative reiterated the findings in the impugned order and argued that duty liability had been correctly ordered for recovery. It was also contended that the impugned orders had taken note of proceedings revived for later period after having been dropped for earlier period by distinguishment of scope of notice. 5. We are not impressed by this argument as the issue of classification, and its distinguishment from that for the earlier period, is contingent upon occurrence of the 'taxable event', viz., manufacture which relegates excisability to secondary determination. The primary issue of consequence of manufacture being emergence of 'waste and scrap' needed to be determined in the light of the circumstances in which notice for recovery on clearances between March 2011 and December 2011 came to be issued. Undeniably, it was the non-discharge after initial discharge of liability since May 2008, which itself arose with amendment to the Explanat....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion of retail sale price on it or adoption of any other treatment on the goods to render the product marketable to the consumer; and the word "manufacture" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production of manufacture on his own account;"' In re Hindalco Industries Ltd, the Hon'ble High Court of Bombay, the entirety of the issue was addressed thus '10. We have, with the assistance of the Counsel appearing for the parties, perused the Larger Bench decision of the Tribunal and impugned in this Writ Petition. We have also perused all the decisions of the Hon'ble Supreme Court brought to our notice and the relevant legal provisions. Section 2(d) of the Central Excise Act, 1944 defines the term "excisable goods", to read as under : "SECTION 2(d). "excisable goods" means goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) as being subject to a duty of excise and includes salt; Explanation - For the purposes of this clause, "goods" includes any article, material or substan....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under Section 3 is directly contrary to the binding Judgments of the Hon'ble Supreme Court on the same issue. The attempt of the Tribunal in para 6.5 in proceeding to analyse that the process and concluding that nobody deliberately manufactures waste, dross and scrap is in direct conflict with the findings of the Hon'ble Supreme Court. Waste and scrap emerge as a by-product in the course of manufacture of other products. The whole purpose of making these observations is to justify the conclusion that because there is a reference to these items in the Tariff Entry or the Tariff Schedule that would change the colour of the controversy. That would enable the Tribunal to then hold that the earlier Judgments and in the case of this very Assessee are no longer good law. However, we do not see how the decision in the case of Grasim Industries Ltd. (supra) and particularly the above reproduced paragraphs could have been brushed aside by the Tribunal. The Hon'ble Supreme Court listed the twin tests and which have to be satisfied before the goods can be said to be excisable to tax or Central Excise duty. It is in these circumstances that the attempt of the Tribunal and which is supported be....