2006 (7) TMI 69 - AT - Central Excise

Dutiability - Alleged that Hammering & Crushing of defective cylinders considered as manufacture but according to appellant it is not an activity of manufacture - Hence such crushed cylinders are not dutiable

Summary

Issues:
Challenge to Order-in-Original regarding activity of hammering and crushing of defective cylinders considered as manufacturing activity under Section Note 8(a) of Section XV of Central Excise Tariff.

Analysis:
The appellants contested the Order-in-Original No. 19/03-04, dated 30-6-03, which classified the hammering and crushing of defective cylinders as manufacturing activity under Section Note 8(a) of Section XV of Central Excise Tariff. The appellants argued that deshaping/flattening of defective cylinders does not qualify as manufacturing since the scrap did not arise during the manufacturing process or metal working. They relied on various legal precedents to support their position.

The Tribunal carefully considered the arguments presented by both sides. It was observed that no mechanical working of metals occurred on the cylinders in question, leading to the conclusion that no scrap was generated as per the definition in Section Note 8(a) of Section XV read with Chapter Heading 72.04 of Central Excise Tariff Act, 1985. Merely crushing and hammering defective cylinders without metal working does not fall under the definition of "waste and scrap." Consequently, the activity cannot be deemed dutiable based on the cited legal judgments.

The Tribunal found that the judgments referenced by the appellants directly applied to the circumstances of the case. Therefore, the Order-in-Original was deemed incorrect and unjust. The appeal was allowed, and the order was set aside, with the appellants entitled to any consequential relief.

In conclusion, the Tribunal ruled in favor of the appellants, emphasizing that the activity of hammering and crushing defective cylinders did not constitute manufacturing under the relevant legal provisions. The decision was based on a thorough analysis of the definitions and legal precedents cited during the proceedings.