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TMI Blog1998 (5) TMI 189X X X X Extracts X X X X X X X X Extracts X X X X ..... duty vide Notification No. 71/68-C.E., dated 1-4-1968. The said Notification which exempted all rubber products in the form of plates, sheets and strips unhardened whether vulcanised or not falling under the old Tariff Item No. 16A(2) from the whole of duty of excise leviable thereon, was amended with effect from 28-2-1986 vide Notification No. 78/86-C.E. 3. The said amending Notification substituted the words - falling under sub-item (2) of Item 16A of the First Schedule to the Central Excises Salt Act, 1944" with the words - falling under Chapter 40 of the Schedule to the Central Excise Tariff Act, 1985." 4. The description appearing in the said Notification was not changed and only the old Tariff Item was replaced with the new Tariff Heading. Further amendment of the said Notification took place on 7-4-1986 vide Notification No. 246/86-C.E. wherein the words - Heading No. 40.05" - were introduced in place of the words - Chapter 40". However, the description of the goods as appearing in the earlier Notification was not changed. With the above amendment dated 7-4-1986, the Department entertained a view that the benefit of Notification was not available to the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ap is outside the charging Section 3 of the Act and mere mention of the same under sub-heading 4004.00 cannot bring the same into the Excise Net. In support of his above submission, he relies upon a recent decision of the Tribunal in the case of Tansi Engineering Works v. Collector of Central Excise reported in 1996 (88) E.L.T. 407 wherein referring to the definition of manufacture in Section 2(f) of the Act, it was held that coverage of goods by a Tariff Heading or sub-heading of Central Excise Tariff Act, is irrelevant and duty can be charged only if the activity in question amounts to manufacture. It was held that the language used in Section 2(f) requires specification of the process concerned as amounting to manufacture and it, further, requires that such specification must be in relation to the goods concerned. It was observed that specification of the goods is irrelevant and what is required is the specification of process. He contends that applying the principles laid down in the said judgment, waste and scrap would come outside the purview of the Excise Duty, inasmuch as no specification of any process as amounting to manufacture, is mentioned either in the Section Notes o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at applying the ratio of the said judgment, waste and scrap cannot be held to be the result of any manufacture and in the absence of any legal fiction created under the law, waste and scrap cannot be held to be a manufactured item. He also makes a reference to the Supreme Court s decision in the case of Collector of Central Excise v. Kiran Spinning Mills reported in 1988 (34) E.L.T. 5 wherein it was held that cutting of fibres into shorter length, though brought into existence some change in the substance, did not amount to manufacture of any new or different commodity. He argues that the burden of proving the dutiability is on the Department as is well-settled by various decisions of the Supreme Court and the Department having failed to establish the excisability of the product in question cannot demand duty on the same. Reliance was placed on the Supreme Court s decision in the case of Moti Laminates Pvt. Ltd. v. C.C. Excise reported in 1995 (76) E.L.T. 241. 9. Learned Advocate, Shri S.K. Bagaria further argues that in any case and any in any view of the matter, the demand in question was barred by limitation inasmuch as the show cause notice was issued on 16-3-1990 for the per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner holding waste and scrap to be non-dutiable. No objection was however raised by the Department as regards the clearance of waste and scrap without payment of duty. In support of his above submission, he relies upon a number of decisions of the Hon ble Supreme Court. 11. Countering the arguments, Shri T. Premkumar, learned S.D.R. reiterates the Order of the Commissioner. 12. As regards the duty-leviability of the micro-sheets, he submits that the micro-sheets are classifiable under Heading 40.08 whereas the Notification in question was amended limiting the scope of exemption only to the goods classifiable under 40.05. He submits that even though the description of goods under the Notification in question was not changed, nevertheless, its scope was limited only to the goods classifiable under 40.05. Since micro-sheets were not classifiable under 40.05, the benefit of the Notification was not to be available to the appellant firm. In support of his above submission, he relies upon the Supreme Court s decision in the case of Gokulchand Rattan Chand v. Collector of Central Excise reported in 1997 (93) E.L.T. 656 (S.C.), wherein the benefit of Notification No. 27/75, da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... process of manufacture or working of rubber and rubber goods, would amount to manufacture of `waste, parings and scrap . Redundancy in law is, generally, frowned on the principle that every word used in a legal provision should be given a meaning and effect. 18. All examples cited by the learned Advocate and set out above, have to be seen in the context that if those definitions of various processes of manufacture had not been given, it would become doubtful, whether the goods arising as a result of any of those specific process undertaken by a person, would have been leviable to duty, once the goods before undertaking that process, had paid duty. It is also to be observed that the description of goods in the concerned Tariff Heading in the examples given, is in general terms such as Cigarettes, Medicines, Cosmetics etc. or Cotton Fabrics, Man-made Fabrics subjected to the process of ...... or any other process. It, therefore, became necessary to define the specific process as a process of manufacture of goods. It was totally necessary to define the `goods arising as a result of such specific process because such `goods do not find a mention at all in the relevant Tariff Desc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case. Reliance placed on Delhi High Court s judgment in Modi Rubber Limited (supra) is not correct because the `waste product arising in that case, was not specifically mentioned as it is in the present case. Consequently, we do not agree with the submission of the learned Advocate that `waste, parings and scrap of rubber products produced in the course of manufacture of rubber goods in the appellants factory are not dutiable. 20. However, we find sufficient force in the appellants plea on limitation. The demand has been confirmed in respect of `Micro Cellular Rubber Sheets for the period from 5-2-1986 to 26-6-1986 and for the `rubber waste and scrap` for the period from 28-2-1986 to 25-6-1986. The show cause notice was issued on 16-3-1990, admittedly after a period of six months. The demand in question raised on the basis of private pass-outs which are maintained by the appellants in the ordinary course of their business. Based upon the said pass-outs, earlier demand raised by the appellants jurisdictional Central Excise Authorities, has been held to be time-barred by the Tribunal vide its Order dated 27-7-1990 relied upon by the learned Advocate. Following the said judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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