TMI Blog2019 (3) TMI 790X X X X Extracts X X X X X X X X Extracts X X X X ..... gibility of the CENVAT credit. Wherever the inputs bills of entry classified the product as waste paper, the appellant is entitled to the benefit of CENVAT credit on waste paper regardless of the fact that some component of such waste paper may be non-paper. Wherever the bills of entry have classified the inputs under different headings, the appellant is entitled to the credit of additional duty paid on waste paper and not the credit of additional duty paid on plastic waste and metal waste. CENVAT Credit allowed - penalty set aside - appeal allowed in part. - E/581-583/2008, E/106/2009, E/174/2009 - A/30352-30356/2019 - Dated:- 14-3-2019 - Mr. M.V. Ravindran, Member (Judicial) And Mr. P. Venkata Subba Rao, Member (Technical) Shri J P Khaitan Shri G. Prahlad, Advocates for the Appellant Shri Arun Kumar, Joint Commissioner/AR for the Respondent. ORDER Per: P.V. Subba Rao. 1. All these appeals pertain to the same issue and hence are being disposed of together. 2. The appellant is a manufacturer of paper and paper-boards using imported waste paper as raw material. Waste paper is unconventional raw material for manufacture of paper and paper-boa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he period January, 2006 to November, 2007 covering both bills of entry assessed under heading 4707 as waste paper before the dispute with regard to the non-paper waste content arose and also bills of entry provisionally assessed in terms of Asst. Commissioner s direction dated 01.03.2005 holding 83% of consignment as waste paper, 12% as plastic waste and 5% as metallic waste. 4. Learned counsel for the appellant submits that there is no dispute that the waste paper content of the consignments imported by them had more than 80% paper content and some non-paper content. In terms of Rule 3(b) of Rules of Interpretation of Tariff, the mixture should have been classified as waste paper which gave the consignment its essential character. However, the customs authorities had not viewed it so as waste paper had a duty concession. In respect of 52 bills of entry, entire assessments were done under customs tariff heading 4707 holding the entire consignments as waste paper. In respect of the rest, the goods were classified under different headings and were charged to duty proportionately subject to the verification of the actual content on segregation at the assessee s/ their job worker s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T Credit Rules and this being an interpretational dispute which is now pending before the Supreme Court no penalty should have been imposed upon them under Sec.11AC. In support of this contention, he relies on the following judgments. a. Bata India Ltd v Special Director [1998 (66) ECC 278 (Cal)] b. Commissioner v Rama Wood Craft Pvt Ltd [2008 (225) ELT 348 (Tri- LB)] c. Chairman, SEBI v Shriram Mutual Fund [2006 (5) SCC 361] d. Vee Kay Enterprises v Commissioner [2011 (266) ELT 436 (P H)] 7. Learned departmental representative reiterates the findings of the lower authorities and asserts that the assessee is entitled to only such amount of credit as is equal to the additional duty of customs paid on the raw material used in or in relation to manufacture. The question whether entire mixture which is imported should be considered as waste paper or it should be treated as three different forms of waste classifiable under different headings as already been decided by the Tribunal Chennai in the assessee s own case (supra) and this decision has not so far been reversed by the Hon ble Apex Court . Therefore, the ratio would apply. 8. Once the assessment is under three ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on that count. What is important is, what does the input invoice/ bill of entry say and how it classifies the input. As long as input bill of entry is assessed or the input invoice classifies the product in a particular way, it has to be followed unless the classification itself is challenged and modified in an appeal. In respect of bills of entry where the input is treated as waste paper unless such classification has been challenged and modified at the appellate stage, the appellant is entitled to CENVAT credit. It does not matter whether some portion of the waste paper so classified turns out to be non-paper content. Insofar as the bills of entry (whether provisional or final) where the inputs are classified under three different headings as waste paper, plastic waste and metallic waste is concerned, only the waste paper is an input which is used in the manufacture of the final product viz., paper and paper-boards. The plastic waste and the metallic waste which are imported along with that in a mixed form are classified separately and no credit can be availed on such non paper waste which evidently does not form any part of the final product. The process of segregation only sepa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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