1995 (12) TMI 187 - AT - Central Excise

Summary

Issues:
Excisability of short length wires claimed as waste and scrap of insulated wires and cables.

Analysis:
The appeal pertains to a dispute regarding the excisability of short length wires claimed as waste and scrap of insulated wires and cables by the Respondent. The key issue revolves around determining whether the material predominates as waste or scrap based on interpretative Rule 2(b) read with Rule 3(b). The department argued that only certain processed wire pieces should be cleared as waste and scrap, while the Respondent contended that the waste generated, including short lengths, cannot be used for other purposes and should be classified as non-excisable waste and scrap.

The Board had established a procedure for clearance of scrap, specifying that only wire pieces not exceeding 12 inches in length or those processed to render them unfit for use could be cleared as waste and scrap. The Respondent, however, maintained that the waste generated during the manufacture of insulated cables, even short lengths, cannot be utilized for other normal wire or cable uses. The Counsel argued that the issue in dispute solely pertains to waste and scrap, not wires or cables capable of other uses, emphasizing that the waste and scrap should be considered non-excisable based on a previous Tribunal order.

Referring to a prior Tribunal decision in the case of M/s Finolex Cables, which held waste and scrap of insulated wires and cables as non-excisable, the Counsel asserted that the present case aligns with the Tribunal's ruling and should be treated similarly. The Tribunal concurred with the Counsel's argument, affirming that the waste and scrap in question should be considered non-excisable in line with the previous order. However, the Tribunal clarified that marketable short lengths of cables should not be confused with cable waste, emphasizing the need for proper enforcement of clearance regulations to ensure only genuine waste is allowed duty-free clearance.

In conclusion, the Tribunal rejected the department's appeal, citing that the show cause notice and impugned orders specifically addressed waste and scraps of wires and cables, which, following the precedent set in the Finolex Cables case, should be classified as non-excisable waste and scrap. The judgment underscores the distinction between marketable short lengths of cables and genuine waste and scrap, emphasizing the importance of enforcing clearance regulations to prevent misuse of duty-free clearance for non-excisable materials.