TMI Blog2017 (7) TMI 885X X X X Extracts X X X X X X X X Extracts X X X X ..... re, but arising on account of wear and tear in the absence of specific provision for such waste and scrap in the relevant rules, duty could not be demanded. As to the leviability on the excise duty on spent Zinc Oxide Catalyst, we find that the same is not a new product arising during the manufacture of final Petroleum products. Since no new item is emerging as a result of the manufacture, duty is not liable on the same. Appeal allowed - decided in favor of appellant. - E/Stay/88/2017, E/92/2007 - A/61339/2017-EX[DB] - Dated:- 14-6-2017 - Mr. Ashok Jindal, Member ( Judicial ) And Mr. Devender Singh, Member ( Technical ) Ms. Shruti Singh, Advocate for the Appellant Sh. G.M. Sharma, A.R. for the Revenue ORDER Per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he manufacture of their final products and duty was leviable only on products which emerge out of manufacturing process. She relied upon the following decisions in her support:- 1. CCE, Pondicherry Vs. CESTAT, Chennai, - 2013 (297) ELT 498 (Mad.) 2. CCE, Mumbai Vs. Deepak Fertilizers Petro Corp Ltd. - 2004 (178) ELT 686 (Tri-Mum). 3. Nirma Ltd. Vs. Commissioner, - 2004 (171) ELT 238 (Tri-Mum). 4. CCE, Chandigarh-I Vs. Markfed Vanaspati Allied Indus., - 2003 (153) ELT 491 (SC) 4. Ld. AR reiterated the findings in the order of the Ld. Commissioner (Appeals). 5. Heard the parties and perused the record. 5. The short issue in this appeal is whether the appellants M/s IOC is liable to pay duty on the scr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the Central Excise Tariff Act, 1985. The Officer viewed that waste and scrap was not restricted to those arising out of the manufacture of machineries; further, anything that is considered as waste and scrap and not usable, would fall under sub-heading No. 7204.90 of the First Schedule to the Central Excise Tariff Act, 1985. In the circumstances, after giving notice, an order of adjudication was made demanding duty as well as penalty. Aggrieved by this, the assessee went on appeal. 4. The First Appellate Authority pointed out that the scrap cleared were out of scrapping of worn out parts of capital goods and these products so cleared were condemned, worn out and unserviceable; such worn out parts were replaced by new parts. The s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at Credit Rules, 2004 shows that the provision for levy of payment of duty on capital goods cleared as waste was inserted by Notification No. 27/2005 effective from 16-5-2005. On the admitted fact that the period covered under the appeals is 2003-04, we do not find justifiable ground to uphold the contention of the Revenue that sub-rule (5A) of the Rules have relevance to the case. 7. As regards the contention that the scrap cleared by the assessee attract duty by way of reversal of credit of payment of duty, even herein, going by sub-section 8(a) of Section XV of the Central Excise Tariff Act, 1985, used and scrap are referred to as one from the manufacture or mechanical working of metals and metal goods. From the admitted fact that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w product arising during the manufacture of final Petroleum products. Since no new item is emerging as a result of the manufacture, duty is not liable on the same. In the case of CCE, Mumbai. Vs. Deepak Fertilizers Petro Corp Ltd. - 2004 (178) ELT 686 (Tri-Mum), the Tribunal took the following view:- After hearing both sides and on considering that Spent Catalyst, the entity, under dispute herein, arises from a Catalyst used, which by definition is not Raw Material considering the settled position in the law as per the Apex Court decision in the case of Ahmedabad Electricity Co. Ltd. [2003 (158) E.L.T. 3 (S.C.)] wherein it has been held - 32....... For being produced and manufactured in India the raw material should h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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