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TMI Blog1998 (6) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... ufacturing. These inputs were manufactured by the appellant and used for captive consumption without payment of duty availing exemption under Notification 217/86, dated 2-4-1986. Objection was taken by the department that such quantity of lead-in-wires and filament wire had not been used in the manufacture of electric bulbs on account of their becoming wasted product. The aforesaid exemption was not available to such quantity not used in the manufacture but rejected as waste. The Collector after going through the prescribed formalities of show cause notice and personal hearing demanded a sum of Rs. 5,22,276/- as Central Excise duty in respect of such waste and also imposed a penalty of Rs. 50,000/-. The present appeal challenges the said fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant therein had been able to evolve a proper method to arrive at the quantum of manufacturing loss whereas in the present case the waste product had been estimated and applied for working out the duty liability. In the circumstances, he pleaded that the Collector s order may be sustained. 4. We have considered the rival submissions. We have perused the record as also the Supreme Court judgment in the case cited by the learned counsel. We are not impressed by the argument advanced by the learned Departmental Representative that the Supreme Court decision will not apply to the facts of the present case and that the difference between that case and the present one relates to the inputs lost in the manufacturing process and the inputs become ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in the manufacture of pipes and tubes. Rebate is to be equivalent to the duty already paid on copper and copper alloys in its crude form, that is to say on the input. The idea seems to be that to the extent of the duty paid on the raw material used exemption has to be given and that has no reference to what ultimately found part of the finished product. It is the duty paid on the input material that is relevant and not the duty referable to the ultimate component of the final product. So far as the manufacture is concerned he has used copper and copper alloys of a particular quantity in the manufacture of pipes and tubes. The `manufacturing loss forms part of the raw material `used in the manufacture though not reflected in the fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing process part of that quantity becomes waste. It cannot be said that the inputs which are relatable to such waste products should be treated on a different footing from the inputs which actually find a place in the manufactured product. The compulsion of manufacturing process may lead to the emergence of some waste or scrap in the present case. In some other manufacturing processes some quantity of input material may be lost in the manufacturing process. There cannot be any difference between such invisible loss and the physical presence of the waste arising in the manufacture of final product. The ratio of the Supreme Court decision cited above and also their decision is the SAIL case will equally apply in the present case. On t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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