Central Excise - Classification of 'Cut tobacco' dust arising in the course of separation of dust from sieved cut tobacco through air-pressure, winnowing waste arising in the course of sieving of cut tobacco, ripped tobacco arising out of the ripping of defective cigarettes - Regarding - Central Excise - 41/90-CX.3

Central Excise - Classification of 'Cut tobacco' dust arising in the course of separation of dust from sieved cut tobacco through air-pressure, winnowing waste arising in the course of sieving of cut tobacco, ripped tobacco arising out of the ripping of defective cigarettes - Regarding Circular No. 41/90-CX.3 Dated 20-7-1990 [From F. No. 18/7/89-CX.3] Government of India Central Board of Excise Customs New Delhi Subject : Central Excise - Classification of 'Cut tobacco' dust arising in the course of separation of dust from sieved cut tobacco through air-pressure, winnowing waste arising in the course of sieving of cut tobacco, ripped tobacco arising out of the ripping of defective cigarettes - Regarding. Attention is invited to Board's Circular No. 58/89-CX.3, dated 5-10-1989 issued from F. No. 81/7/89-CX.3 wherein it was, inter-alia, clarified that winnowing waste arising in the course of sieving of cut tobacco would be classifiable under Heading No. 24.01 as 'tobacco refuse'. Under Notification No. 356/86-CE, dated 24-6-1986, cut tobacco can be sent to another factory for use therein in the manufacture of machine rolled cigarettes on availment of concessional rates of duty by following Chapter X procedure. Now, in the context of this notification, doubts have been expressed whether differential duty in respect of such quantities of cut tobacco received under Chapter X procedure and contained in tobacco refuse is to be realised or not. 2. The matter has been examined. The tobacco refuse which arises out of cut tobacco received under Chapter X procedure can be cleared without payment of duty. Further, there is no specific provision under Chapter X procedure for demanding duty on refuse arising out of excisable goods obtained under that procedure irrespective of the fact whether such refuse is further excisable or not. However, it is felt that Rule 195, of the Central Excise Rules under Chapter X procedure would definitely take care of such situations, Under Rule 195, refuse of excisable goods can be disposed of after examination by, and with the written permission of the proper officer. However, it does not imply that in regard to refuse obtained from cut tobacco the credit taken has to be expunged. Therefore, it is clarified that it would not be correct to the credit when non-dutiable tobacco refuse arises out cut tobacco, whether the cut tobacco is used within the factory of manufacturer in any other factory under Notification No. 356/86-C.E., dated 24-6-1986, as amended. 3. The above guidelines may be brought to the notice of lower field formations and the trade interests also may be suitably advised. 4. All pending assessments may be finalised on the above basis.