2007 (10) TMI 472 - AT - Central Excise

Summary

Issues:
Revenue's appeal against setting aside of Orders-in-Original regarding recovery of Cenvat credit on Capital Goods and inputs removed as waste and scrap.

Analysis:
The Commissioner (Appeals) set aside the Orders-in-Original noting that the Capital Goods, after full utilization, were removed as waste and scrap, and therefore, the Cenvat credit utilized did not need to be reversed. The learned Counsel relied on various judgments supporting the non-reversal of credit in such cases. The Revenue cited a contra order from the Kolkata bench involving empty drums considered as waste and scrap. The Counsel argued that only scrap resulting from mechanical working of metals or manufacturing processes are dutiable, not fully utilized Capital Goods. The Tribunal referenced the definition of Waste and Scrap in the Central Excise Tariff, emphasizing that scrap from mechanical working of metals requires duty payment. The Tribunal found the Capital Goods removed were old machineries and not within the dutiable scrap category. The judgments cited by the Counsel, including a Supreme Court ruling, supported the assessee's position. Consequently, the Tribunal confirmed the impugned order, rejecting the appeal.