2016 (11) TMI 640 - AT - Central Excise

Demand - Process amounting to manufacture - process of electro plating is akin to galvanising or zinc plating - Held that - similar issue stands decided in the appellant s own case COMMISSIONER OF C. EX., LUDHIANA Versus DEEPS TOOLS PVT. LTD. 2010 (4) TMI 495 - CESTAT, NEW DELHI where it was held that Merely because the scrap has been marketed, the same cannot be held to have emerged as a result of manufacture. The appellant is not required to pay duty on copper scrap generated during the course of their activity of nickel plating/electro plating which does not amount to manufacture - appeal allowed.

Summary

Issues:
Appeal against duty demand on copper scrap in the context of electroplating process.

Analysis:
The appellant, engaged in hand tool manufacturing, faced a duty demand on copper scrap generated during nickel plating/electroplating, which was considered a non-manufacturing process. The Revenue contended that duty was payable on the copper scrap arising during electroplating. A show cause notice was issued for duty payment, interest, and penalty for a specific period. The adjudicating authority initially dismissed the proposal, but the Commissioner (Appeals) overturned this decision, leading to the appellant's appeal.

The appellant argued that a previous case in their favor, decided by the Tribunal, should apply to this situation. In the prior case, it was established that the copper wire used in electroplating, which later became scrap, did not necessitate duty payment as it did not result from a manufacturing process. The Tribunal emphasized that the concept of manufacture should consider raw materials, processes, emergence of distinct products, and marketability. Since the issue was already settled in the appellant's favor in the previous case, the Tribunal ruled that duty on copper scrap from electroplating was not required.

Consequently, the Tribunal set aside the impugned order, allowing the appeal and any consequential relief. The decision was made based on the precedent set by the Tribunal in the appellant's earlier case, confirming that duty on copper scrap from non-manufacturing processes like electroplating was not applicable.