9911796707
TMI Blog2009 (2) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... ed products became exempted with effect from 1-3-2003, the appellants started operating under notification No. 43/2001-C.E. (NT.) dated 26-6-2001 for procurement of duty free raw material. While the appellants contend that no duty is payable on the waste and scrap generated out of raw material procured duty free for the purpose of export under notification No. 43/2001-C.E. (N.T.), dated 26-6-2001, the revenue has contended that duty is payable in view of Para (V) of notification No. 43/2001-C.E. (N.T.). After issue of show cause notice and adjudication process, the impugned order has been passed confirming demand of duty of Rs. 65,09,514/- for the period from April 2007 to October 2007. Redemption fine of Rs.15,00,000/- has been imposed in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed and if assessment is to be done, the appropriate duty has to be charged. The appropriate duty leviable is nil in view of unconditional exemptions available under two notifications cited by him. He also cited several decisions in support of his arguments. Learned D.R. on the other hand submits that the Hon'ble Supreme Court has held that appropriate duty does not mean nil duty. So whenever the word "appropriate" has been used, goods cannot be assessed to nil duty in view of the judgment of the Hon'ble Supreme Court in Collector of C. Ex., Vadodara v. Dhiren Chemical Industries case reported in 2002 (139) E.L.T. 3 (S.C.). He also reiterates the grounds taken by the Commissioner that the condition that appropriate duty is payable on waste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pproach. The notification requires appropriate rate of duty to be determined before removal of waste and scrap and it does not lay down any condition that waste and scrap arising because of processing of duty free raw materials have to be cleared on payment of duty only notwithstanding any exemption under any other notification. In any case as discussed the assessment process starts after the waste and scrap have arisen and therefore the appellants' claim that they are eligible for exemption notifications cited by them has to be considered. Both the exemption notifications cited by the appellants are totally unconditional. Both the exemption notifications do not have a condition that waste and scrap arising should have arisen as a result of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n both Anand Ployrotex and Universal Cable Ltd. cases it was held that the provisions of Modvat Rules require that waste and scrap has to be removed on payment of duty, if any, payable thereon. In the case of Universal Cable Ltd. the Hon'ble High Court of Madhya Pradesh observed that clause iv (1) (a) of sub-rule (3) means that the waste material shall be removed on payment of duty, if any, payable thereon and since no duty was payable on dross and skimmings removed by the petitioner, there cannot be any breach of Rules. Since the assessment process starts after the manufacturing process is over and waste and scrap are generated, the assessment process has to be carried out as per the law and we find that when this is done the appellants ar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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