2000 (6) TMI 540 - AT - Central Excise

Summary

Issues involved:
Whether exemption under Notification No. 149/86-CE and 178/88-CE is available for billets of brass manufactured from duty paid waste and scrap.

Analysis:
The appeals revolve around the issue of whether brass billets, an intermediary product in the manufacture of brass rods from duty paid waste and scrap, are eligible for exemption under Notification No. 149/86-CE and 178/88-CE. The appellant argued that since brass rods are wholly exempt under the mentioned notifications, the billets should also be exempt as they meet the same conditions. The Collector confirmed a demand and imposed penalties, stating that since exemption was already granted for brass rods, it cannot be extended to billets. The appellant contended that the intention is to grant exemption at both stages and emphasized that the Collector himself acknowledged the exemption eligibility of the billets. The appellant also cited a Tribunal decision supporting the eligibility of billets for exemption under similar circumstances.

On the other hand, the Respondent argued that the notifications provide exemption for billets/cast articles of copper, not brass, and thus, brass billets are not covered. The Respondent also raised the issue of extended limitation period for captive use, asserting that mere mention of captive consumption in classification does not prove actual use in exempted product manufacture. The appellant countered by stating that the Collector's findings support billet exemption eligibility and objected to arguments beyond the Collector's order. Additionally, the appellant mentioned eligibility for Modvat credit if duty payment on brass billets is required, as they had not availed credit for raw material duty.

The Tribunal analyzed the notifications and Collector's findings, noting that the Collector recognized billets' exemption eligibility but refrained from granting it due to the exemption already claimed for brass rods. Considering the undisputed duty paid nature of waste and scrap, and a relevant Tribunal decision not available during the initial adjudication, the Tribunal remanded all appeals to the Commissioner of Central Excise for reassessment of the availability of notifications for brass billets manufactured by the appellants. Consequently, all three appeals were allowed by way of remand for further consideration.