2012 (10) TMI 909 - AT - Central Excise

Waiver of pre-deposit demand of duty in respect of floor sweepings and defective cakes, which emerge during the process of manufacturing of their final products i.e. biscuits and cakes Held that - Floor sweepings, processed defective cakes etc. cannot be held to be excisable goods - defective cakes and floor sweepings which are sold in the market is nothing but waste and scrap and merely because they were being cleared as floor sweepings will not make them excisable goods - The same are not being manufactured by the appellant and emerged during the manufacturing of final products - these not are covered by Section 2(d) - there is no tariff heading in the Central Excise Tariff covering floor sweepings and defective cakes - pre-deposit waived

Summary

Issues:
Prayer to dispense with pre-deposit of duty on floor sweepings and defective cakes.

Analysis:
The case involved an application seeking dispensation of the pre-deposit condition of duty amounting to Rs. 54,391 imposed on the applicant for floor sweepings and defective cakes arising during the manufacturing of biscuits and cakes. While previous Tribunal decisions held such items not to be excisable goods, the lower authorities referenced an amended section of the Central Excise Act, which broadened the definition of "goods" to include any item capable of being bought and sold. The applicant argued that the amended provision did not change the nature of defective cakes and floor sweepings, as they were waste products that emerged during manufacturing and were not intended for sale as separate goods. The absence of a specific tariff heading for these items in the Central Excise Tariff supported this argument. The Tribunal, concurring with the applicant's position, dispensed with the pre-deposit condition of duty and interest, staying its recovery pending the appeal process. The decision was pronounced in open court by Member (J) Archana Wadhwa.