2004 (2) TMI 455 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notification No. 49/97 regarding the availability of benefits to waste and scrap arising in the manufacturing process.

Analysis:
The appeal in question involved the interpretation of whether the benefit of Notification No. 49/97 is applicable to waste and scrap generated during the manufacturing of the final product subject to Central Excise duty under Section 3A of the Central Excise Act. The appellant, M/s. Pepsu Steel Rolling Mills, contended that the Commissioner (Appeals) had disallowed the benefit of the notification, arguing that the Miss-Rolls arising during the manufacturing process were indeed waste and scrap covered under the notification. The appellant highlighted that Miss-Rolls were unusable as finished goods and should be classified as waste and scrap, making them eligible for the exemption under Notification No. 49/97. The appellant relied on a previous decision to support their argument. On the other hand, the respondent, represented by Shri P.M. Rao, supported the findings of the impugned order disallowing the benefit of the notification.

Upon considering the arguments from both sides, the Tribunal analyzed Notification No. 49/97, which exempts waste and scrap arising during the manufacture of specific products subject to Central Excise duty. The Tribunal noted that Miss-Rolls, by their very nature, were not usable as rolls and had arisen during the manufacturing process of Hot Re-rolled products subject to excise duty. The Tribunal found merit in the appellant's argument that Miss-Rolls should be classified as waste and scrap, making them eligible for the exemption under the notification. The Tribunal emphasized that the notification's scope of waste and scrap was broad and covered all waste and scrap falling under the Central Excise Tariff Act, not limited to a specific classification. Referring to a previous case involving runners and risers, the Tribunal reiterated that the exemption under the notification was not restricted to waste and scrap classified under a specific heading, thereby supporting the appellant's position. Additionally, the Tribunal cited a relevant circular to reinforce its interpretation of the notification's applicability to waste and scrap arising during the manufacturing process.

In conclusion, the Tribunal set aside the impugned order and allowed the appeal filed by M/s. Pepsu Steel Rolling Mills, recognizing the Miss-Rolls as waste and scrap eligible for the benefits under Notification No. 49/97.