1991 (10) TMI 47 - HC - Central Excise

Summary

Issues:
Imposition of additional duty of Customs (countervailing duty) on acrylic sheet scrap imported before and after 1st March, 1982.

Analysis:
1. Imported before 1st March, 1982: Acrylic sheet scrap falls under Central Excise Tariff Item No. 68, not under Item 15A. A previous Division Bench decision confirmed this classification.

2. Imported after 1st March, 1982: The petitioners argue that acrylic sheet scrap from Item 15A(2) is not covered by Explanation III(c). CEGAT decisions upheld by the Supreme Court support this argument. In Prakash Products v. Collector of Customs, the Tribunal ruled that waste and scrap from materials in sub-item (1) are covered by Explanation III, not those from sub-item (2).

3. CEGAT Decisions: The Tribunal in Paresh Products v. Collector of Customs also supported the classification of scrap from Item 15A(2) under Tariff Item 68. Supreme Court summarily dismissed appeals from these decisions, affirming the Tribunal's stance.

4. Excise Duty on Scrap: The issue of excise duty on scrap was settled by the Supreme Court in Khandelwal Metal & Engineering Works, where it was established that scrap is an excisable commodity.

5. Decision and Actions: The petitioners are liable to pay countervailing duty on acrylic sheet scrap under Central Excise Tariff Item 68. The respondents are directed to calculate the duty payable and inform the petitioners. The petitioners must pay the duty within six weeks or risk the encashment of bank guarantees. Bank guarantees to remain active for four months. Those who paid excess duty under Tariff Item 15A can apply for a refund separately.

6. Conclusion: No costs awarded. The judgment clarifies the classification and duty liability of acrylic sheet scrap imported before and after 1st March, 1982, based on the relevant Tariff Items and legal precedents, ensuring compliance with customs regulations.