TMI Blog2018 (5) TMI 2021X X X X Extracts X X X X X X X X Extracts X X X X ..... accordingly,Board s Circular No.584/21/2001-CX dated 07.09.2001 was set aside. In the said Circular, it was held that cutting of HR/CR Coils of iron of non-alloy steel into sheets or slitting into strips of lesser width or slitting of sheets into strips will amount to manufacture if the resultant product is classifiable under different sub-heading of the Central Excise Tariff. Subsequently, CBEC withdrew the Circular in 2005 by issue of Circular dated 2nd March, 2005, wherein it has been clarified that the activity of cutting and slitting of HR/CR Coils into required length do not amount to manufacture of Excisable goods within the meaning of Central Excise Act. The question of charging Central Excise duty on the waste and scrap emerging ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raightening cutting and slitting of CR/HR coils into required length and width and deliver the finished material as per instruction of Tata Steel to their customers, on conversion charges as specified in their agreement. Until the time, the Hon ble Delhi High Court in the case of M/s Faridabad Iron Steel Traders Association Vs. Union of India reported in 2004 (178) ELT 1099 (Del.) holding that the process of cutting and slitting of steel sheets in coil form to specific sizes does not amount to manufacture of excisable goods and SLP filed against the same, was dismissed by the Hon ble Supreme Court, the TSL use to clear the goods on payment of applicable duty of Excise to EPA s who use to send back the manufactured goods along with the pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was observed that on receipt of duty paid scrap/defective coils from EPAs, TSL cleared the same by auction as duty paid goods at a higher price than the price at which the said goods were received from EPAs. In the above circumstances, EPAs was required to pay duty on the price at which TSL sold the same in auction to the independent buyers. Therefore, the Department felt that EPAs have evaded/short paid Central Excise duty leviable on the said scrap/defective coils so sold on auction basis. Accordingly, show-cause notice was issued by the Department, which resulted into the impugned order. 3. The ld.Sr.Advocate appearing on behalf of the appellants, submits that the dispute related to the period from June, 2003 to June, 2005. In view ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an end to dispute paid the entire amount for the period in question on the behalf of EPA. Further, the ld.Sr.Advocate submits that when the activity undertaken by the EPA does not amount to manufacture, there is no question of payment of duty on waste/scrap arising out of such process. He relied upon the following cases laws : (i) Grasim Industries Ltd. Vs. Union of India : 2011 (273) ELT 10 (SC) ; (ii) Ultratech Cement Ltd. Vs. CCEx. S.Tax : 2017 (345) ELT 130 (T) ; (iii) Pepsico India Holdings (Pvt.) Ltd. Vs. CCEx. : 2017 (358) ELT 1089 (T) ; (iv) Shivangi Metal Industries Pvt. Ltd. Vs. CCEx., S.Tax : 2017 (358) ELT 863 (T) ; In all these case laws, it is held that the waste and scrap generated during the process of cu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and hence, there could be no proceedings initiated against the appellant by issuance of notice under Section 11A (1) of the Act. As the provisions of Section 11A (2B) of the Act is applicable to the instant case, the imposition of penalty upon the appellants under Section 11AC of the Act is also not correct and legal. Further, the ld.Commissioner has also erred in penalty upon M/s Tata Steel under Rule 25 of the said Rules. 4. The ld.D.R. appearing on behalf of the Revenue, has reiterated the grounds contained in the impugned order and further stated that in this case, M/s Tata Steel has realized more amount by way of auction waste and scrap/rejected materials received from EPAs and therefore, the same should be taken as value for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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