TMI Blog1989 (5) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... ly stated in the writ petition itself. 2. It is alleged that in course of making and/or producing toughened glass, laminated glass and mirrors, glass being brittle and fragile by nature, breakage occurs at various stages. Such broken glass/waste is otherwise known as cullets which can only be used after remelting for the manufacture of glass and glassware. It is also alleged that such broken glass/cullets is a waste product and nothing but scrap and is not 'goods' within the meaning of the said Central Excises Salt Act, 1944 (hereinafter referred to as the said Act, 1944) and/or otherwise and cannot be ordinarily bought and sold in the market as finished manufactured goods. The broken glass/cullets not being goods cannot be said to be subjected to any duty of excise. It is further alleged that under Section 3 of the said Act, 1944, duty of excise is leviable only on the manufacture of goods. The duty under said Act is not leviable on scraps or waste materials unless specified in the First Schedule of the said Act, 1944. 3. Stating in details all the above facts, the writ petition has been filed and a Rule was issued on February 9, 1982. The writ petitioner has come to this Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n relevant facts and also by reiterating the stand taken in the main writ petition. 6. It appears from the affidavit-in-opposition filed by the contesting respondents that the petitioner Company carries on its business of manufacturing glass mirrors, laminated safety glass, toughened glass, flat and curved safety glass, wind screens, door screens and back screens out of toughened glass out of flat sheet glass. Goods manufactured by the petitioner company can be classified under Tariff Item No. 23A(4) of Central Excise Tariff and allowed relief of duty on raw materials, i.e. flat glass purchased from the market under proforma credit system under Rule 56A in accordance with the Government of India Notification No. 196/79 dated 31-5-1979. It is also stated in the said affidavit-in-opposition that the petitioner company was availing of the proforma credit system under Rule 56A of the raw materials and clearing the principal products under sub-item 4 of the Tariff Item No. 23A of Central Excise Tariff. It is asserted in the said affidavit-in-opposition that in the process of manufacture of principal products broken glass/cullets are derived out of the materials of, i.e. plat sheet gla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 and such cullets/broken glass had never been declared as waste product of glass. The Collector of Central Excise decided the case concerned as an offence under the Central Excise Act and Rules thereto and confirmed the claim for duty for such clearance. According to the respondents, the acts done and/or caused to be have been done by the respondents authorities are well justified as per the provisions of law. 9. Having heard Mr. Bhattacharya, Learned Advocate for the petitioner and Mr. Bose, Learned Advocate for the respondents at length, this Court finds that before the Customs, Excise and Gold (Control) Appellate Tribunal 'Waste' has been considered in a case reported in 1988 (18) ECR 554 (M/s. Indian Tube Co. Ltd. v. Collector of Central Excise). It will appear therefrom that in its capacity as a waste product, spent sulphuric acid is not liable to duty as it has no independent market by itself. Diluted sulphuricacid is used by the said Indian Tube Co. Ltd. for the process of pickling steel pipes, tubes and strips for removal of scale formation. Once its efficacy is reduced, this is of no further use to the said company and such sulphuric acid supplied free to M/s. Cynamides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fibre into shorter lengths is not 'manufacture' under the Central Excise law as no new substance is brought into existence. 11. Considering the ratio of the above decisions, it appears before this Court that two questions are to be determined, namely, (a) Whether the broken glass/cullets are to be deemed as manufactured items excisable under the Central Excises and Customs Act, 1944; and (b) Whether the petitioner company is liable to meet the demand for the waste materials known as broken glass/cullets and/or Bhagars. 12. After thoroughly scrutinising the pleadings of the parties and looking to the provisions of law, this Court is of the view that in the process of manufacture of several classes of items, the broken glass/cullets and/or Bhagars cannot be construed as items 'manufactured' or can be construed as any by-product or having any character of marketability and thus cannot be liable to be levied, under the provisions of Excise Customs Act. Secondly, this Court is of the view that such waste arising out of manufacturing the non-items are not clearly stated in the Tariff Items and there cannot be any demand of excise duty upon such waste materials or items by draw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id as stated by the petitioner, on or about 19-4-1989. Such fact has been brought to the notice of the Court as a subsequent event by filing a Supplementary Affidavit for which leave was granted and the same was filed in course of the delivery of the judgment. Such facts in the said supplementary affidavit have not been controverted by the respondents. 14. Considering all the materials in the proper perspective this Court is clearly of the view that the broken glass/cullets occurring in course of manufacturing of the finished goods by the petitioner company are not coming within the mischief of excise duty. Those broken glass/cullets and/or waste materials are not such by-products having any marketability and those are not subject to be levied towards Excise duty. The impugned orders as challenged by the writ petitioner suffer from inherent defects and the decision based upon the fact that broken glass/cullets may be construed within the Tariff Item No. 23A(iv) as covered by the expression 'other glass' is not correct. 15. It is, however, argued with force by referring to the decisions reported in AIR 1961 SC 1056 (Sales Tax Commr. v. Modi Sugar Mills and AIR 1975 SC 1867 (Banw ..... X X X X Extracts X X X X X X X X Extracts X X X X
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