TMI Blog2001 (11) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... anspired that the appellant was using paper and paper board for the manufacture of printed paper board boxes. During the course of manufacture of such boxes, waste/scrap/parings are generated, it was alleged that this waste was classifiable under Chapter sub-heading 4702.90 of Central Excise Tariff Act. Scrutiny of private records revealed that the appellant was selling this waste/scrap/parings. It was also noticed that they did not declare waste/scrap/parings; that they did not file classification list under Rule 173B nor issued any invoices prescribed under Rule 52A. Accordingly, a SCN was issued to the appellants asking them to explain as to why duty amounting to Rs. 23,20,000/- should not be demanded from them and why penalty should not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, ld. Counsel submits that the appellant is a manufacturer of matches and match boxes. He submits that they purchased duty paid papers and paper board in addition to other inputs for manufacture of matches and match boxes. He submits that in the manufacture of match box, waste is generated at various stages; that some waste is generated before the start of manufacture of match boxes; that some waste is generated by end cuttings and parings. He submits that Department has classified it under Chapter Heading 4702.90 as 'recovered (waste and scrap) paper or paper board'; that the product is not recovered paper or paper board. He submits that for levy of duty there should be some manufacture; that the manufacture implies value addition. He sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elief of the appellant that no duty was payable on waste and scrap which was sold by them at a very nominal price. Ld. Counsel submits that if waste/scrap and parings are sold in the market, they do not become goods for purpose of levy of excise duty. In support of his contention, he submits that dross and skimmings of aluminium though sold in the market for recovery of metal are not goods. Ld. Counsel, therefore, submits that since the goods are not manufactured, therefore, no duty is leviable on the goods. He, therefore, prays that the appeal may be allowed. 6. Shri R.C. Sankhla, ld. DR appearing for the respondent Commissioner submits that in the instant case what is generated is waste/scrap and parings; that there is a specific head ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ings of paper and paper board tantamounts to charging duty on the same product twice. We note further that manufacture implies value addition. In the instant case, there is no value addition inasmuch as paper and paper board used as inputs is costlier than waste, scrap and parings of paper and paper board generated in the process of manufacture of match boxes. 8. We further note that labour and manipulation is used in the process of manufacture but every operation of labour and manipulation cannot be termed manufacture. Only that operation which brings into existence a distinctly new substance in name, character and use can be termed as manufacture. In the instant case no new substance is generated and hence the process cannot be termed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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