M/S. Man Structural Pvt. Ltd vs Cce-Jaipur-I

[Arising out of Order-in-Appeal No. 02 (DK)CE/JPR-I/2010 dated 04.01.2010 arising out of order-in-original no. 75/Adj./2008 dated 16.01.2009 passed by CCE-Jaipur]

For Approval & Signature:

Honble Shri Ashok Jindal, Member (Judicial)

Honble Shri B.Ravichandran, Member (Technical)

1. Whether Press Reporter may be allowed to see the Order for Publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether their Lordships wish to see the fair copy of the order?

4. Whether order is to be circulated to the Department Authorities?

M/s. Man Structural Pvt. Ltd. Appellant

Vs.

CCE-Jaipur-I Respondent

Appearance: Shri Bipin Garg, Advocate for the appellant

Shri Ranjan Khanna, DR for the respondent

Coram: Honble Shri Ashok Jindal, Member (Judicial)

Honble Shri B.Ravichandran, Member (Technical)

Final Order No.52524/2015

Per: Ashok Jindal

Appellant is in appeal against the impugned order demanding duty on scrap and waste generated during the course of fabrication of factory shed.

2. The facts of this case are that the appellant procured angle, channels, etc. which were used by them for fabrication of factory shed which was embedded to earth and while fabrication of this factory shed, some waste and scrap was generated which was ultimately used by the appellant for fabrication of trolley line in their factory. Revenue is of the view that the appellant is required to pay duty on waste and scrap generated during fabrication of factory shed in their factory. Consequently, impugned proceedings were initiated against the appellant and converted into impugned demand. Aggrieved from the said orders, the appellant is before us.

2. Ld. Counsel for the appellant submits that these waste and scrap has been further used by the appellant captively for fabrication of trolley line. Therefore, as per section note 8 to Section 15 of Central Excise Tariff Act, the impugned scrap does not fall under waste and scrap as waste and scrap defines the waste and scrap which is not useable as such. He submits that as it is a fact on record that these waste and scrap has been captively used by the appellant. Therefore, it does not qualify as waste and scrap as defined in Section Note 8 to Section Note 15 of Central Excise Tariff Act and they are not required to pay duty thereon. He, further submits that the ld. Commissioner (appeals) held that the trolley line which has been manufactured by the appellant falls under Chapter 72 of Central Excise Tariff Act, 1985. Therefore, the trolley line is not capital goods. Consequently, they are not required to pay duty on waste and scrap which has been used by them for fabrication of trolley line.

3. On the other hand, ld. AR reiterated the findings of the Commissioner in the impugned order.

4. Heard the parties in detail and considered the submissions.

5. In this case, duty has been demanded on waste and scrap generated during the course of fabrication of factory shed which was ultimately used for fabrication of trolley line. Therefore, the metal which has been used for fabrication of trolley line cannot be defined as waste and scrap as per section note 8 to section 15 of Central Excise Tariff Act, 1985 which defined as under:

In this section, the following expressions have the meanings hereby assigned to them:

(a) Waste and scrap

Metal waste and scrap from the manufacture or mechanical working of metals, and metal goods definitely not usable as such because of breakage, cutting-up, wear or other reasons.

6. As by plain reading of the said section note, it is clear that the metal which becomes non-useable as such waste and scrap admittedly in this matter, the waste and scrap has been used for fabrication of trolley line cannot be the said unusable waste and scrap as such. Therefore, the appellant is not liable to pay duty thereon. Further, the trolley line cannot be classified under Chapter 72 of Central Excise Tariff Act, 1985. Therefore, the waste and scrap in question is not liable for payment of duty. In these circumstances, we set aside the impugned order and allow the appeal with consequential relief, if any.

(Dictated and Pronounced in the open court)

(Ashok Jindal) Member (Judicial)

(B. Ravichandran)

Member (Technical)

Ritu

3