1998(09)LCX0001
IN THE CEGAT, SOUTH ZONAL BENCH, MADRAS
S/Shri S.L. Peeran, Member (J) and V.K. Ashtana, Member (T)
CARBORUNDUM UNIVERSAL LTD.
Versus
COMMR. OF C. EX., COIMBATORE
Final Order No. 1893/98, dated 25-9-1998 in Appeal No. E/1616/89-D
Cases Quoted
Collector v. Spartek Ceramics India Ltd. — 1997 (019) RLT 0427 (Tribunal) — Relied on [Para 2]
Hindustan Safety Glass Works Ltd. v. C.B.E.&C. — 1989(05)LCX0006 Eq 1990 (045) ELT 0066 (Cal.) — Relied on [Para 2]
Collector v. Carborundum Universal Ltd. — 1998(07)LCX0078 Eq 1998 (103) ELT 0363 (Tribunal) — Relied on [Para 2]
Collector v. Aluminium Industries Ltd. — 1987(06)LCX0078 Eq 1987 (031) ELT 0748 (Tribunal) — Relied on [Para 2]
Nicco Corporation Ltd. v. Commissioner — 1997(09)LCX0122 Eq 1998 (097) ELT 0106 (Tribunal) — Relied on [Para 2]
Britannia Industries Ltd. v. Collector — 1997(05)LCX0022 Eq 1997 (093) ELT 0719 (Tribunal) — Relied on [Para 2]
Advocated By : Shri R. Raghavan, Advocate, for the Appellant.
Shri Sankara Vadivelu, SDR, for the Respondent.
[Order per : S.L. Peeran, Member (J)]. - The question that arises for consideration in this appeal is as to whether broken Grinding Wheel is classifiable under sub-heading 6801.90 of CET Act, 1985.
2. Learned Advocate submits that in a similar proceedings in another order-in-original dated 2-11-1978, the Assistant Commissioner has clearly held that the defective Grinding Wheels are only scraps and are not grinding wheels which could be used for the purpose for which normally Grinding Wheels are intended. To come to this conclusion, he has relied on the report of the Chemical Examiner, Custom House, Madras who has reported that the question could be answered only with reference to market enquiry. The Assistant Commissioner has noted that the market enquiry was conducted by the Range Officer in-charge of the Appellant factory, who found that these “Defective and broken grinding wheels” are not accepted as Grinding wheels in the market. He submits that this factual position is not disputed even in the impugned order. It is his contention that the item being a scrap it does not finding a heading under the Tariff Act and hence it has to be held as not exigible. He submits that in respect of broken glass tiles, the Tribunal in the case of CCE v. Spartek Ceramics India Ltd., in 1997 (019) RLT 427 has held that broken glass tiles are not classifiable under Heading 6906.19 or residuary heading and hence they are not excisable. He also relied on the judgment rendered by Calcutta High Court in the case of Hindustan Safety Glass Works Ltd. v. C.B.E. & C. as reported in 1990 (045) ELT 66 wherein it has been held that broken glass/cullets/bhagars arising in the process of manufacture of glass items are not manufactured items and they are bi-products and being not marketable, are therefore not excisable. He also relied on the judgment rendered by the Tribunal in their own case as in the case of CCE v. Carborundum Universal Ltd., by CEGAT Order No. 1336/98, dated 14-7-1998 [1998(07)LCX0078 Eq 1998 (103) ELT 0363 (Tribunal)] wherein it has been held that, “Dust Collector fine” emerging during the manufacture of Grinding Wheels is an industrial waste and it is not excisable. He further refers to the judgment rendered in the case of CCE v. Aluminium Industries Ltd., as reported in 1987 (031) ELT 748 wherein it has been held that waste and scrap is not classifiable under any heading of the Tariff. He further relies on the judgment rendered by ERB in the case of Nicco Corporation Ltd. v. CCE as reported in 1998 (097) ELT 106 wherein it has been held the defective, rejected and unservicable cut pieces of wires and cables are not marketable as wires and cables and hence they are not excisable. He relies on the judgment rendered in the case of Britannia Industries Ltd. v. CCE as reported in 1997 (093) ELT 719 wherein it has been held that waste and scrap generated during the manufacture of biscuits such as dry waste and wet waste consisting of spilled raw materials, under baked and over baked biscuits are not excisable goods. He submits that in view of the large number of judgments, the broken Grinding Wheels, not being grinding wheels, cannot be considered as excisable products, as the market enquiry done by the Range Officer in-charge of the Appellant’s factory itself has clearly stated that “Defective and broken Grinding Wheels” are not accepted in market as grinding wheels. Therefore, he prays for allowing the appeal.
3. Heard learned SDR.
4. On a careful consideration of the submission and on perusal of the record of citation referred to before us, we notice that waste and scrap in all the noted cases have been held to be not excisable goods. In the present case, the Range Officer in-charge of the Appellant’s factory on enquiry has clearly found that these “Defective and broken” grinding wheels are not accepted as grinding wheels in the market. These facts has been noted by the Assistant Commissioner in order-in-original dated 2-11-1978 in a similar proceeding. The item being broken wheels and being scrap is not disputed in the impugned order. The Commissioner has proceeded on the basis that the Notification No. 234/82 required such waste products and bi-products to be classifiable under Tariff Item 68 of the CE Tariff. As against the classification of Grinding Wheels under Tariff Item 51, he has held that in the new Tariff, the Grinding Wheels are excisable under Heading 68.01 and therefore such scraps should fall as parts under 6801.90. We are not agreeable with this conclusion to classify the broken Grinding Wheels, which has been accepted as scrap, as parts under the residuary Heading 6801.90. For the purpose of classification of this item, first we have to see as to whether they are goods and are marketable as Grinding Wheels. The admitted position is that broken grinding wheels in terms of the market enquiry is not accepted as Grinding Wheels but are treated as “scrap”. In the light of the noted judgment, waste and scrap cannot be considered as the same material as `grinding wheels’, more particularly, as this “broken and defective grinding wheels does not have any sub-heading as ”waste and scrap" in the Tariff Act. Therefore, following the ratio of the noted judgment, we have to hold that the broken and defective Grinding Wheels are not the same as Grinding Wheels and they are also not parts thereof. Hence admittedly being waste and scrap, they are not classifiable as parts under the sub-heading 6801.90. As there is no other Tariff Heading, they are to be held as not excisable goods. In this view of the matter, following the ratio of the judgment, we set aside the impugned order and allow the appeal.
_______
Equivalent 1999 (107) ELT 100 (Tribunal)
Equivalent 1999 (030) RLT 0446