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TMI Blog2000 (7) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture of aerated waters falling under Chapter 22 of the Central Excise Tariff Act. They were also availing of Modvat credit of duty paid on glass bottles received by them as inputs. They were served with a Show Cause Notice dated 4-3-1997 asking them to show cause as to why Central Excise duty amounting to Rs. 42,78,164.20 should not be demanded on the value of clearances of glass bottles sold by them as such and on sale of waste and scrap of glass bottles not paid during the period 1-4-1992 to 19-10-1995 and why penalty should not be imposed. By the impugned order, the Commissioner, Central Excise, New Delhi confirmed the duty demand and imposed a penalty of Rs. 5 lakhs under Rule 173Q read with Rule 9(2). The invoking of the extende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l product under Rule 57A. Ld. Counsel has contended that the issue to be decided was whether the credit taken on bottles that get damaged/broken during the course of manufacture of the final product requires to be reversed. It had to be borne in mind that the appellants were not the manufacturers of the glass bottles but had purchased the bottles from outside after paying duty. Admittedly some percentage of the bottles get broken during the manufacturing process of Aerated waters. Further in terms of Rule 57F(l)(ii) the requirement of intimating the Asst. Commissioner and the obtaining of dated acknowledgement is required only when the inputs in respect of which credit has been allowed under Rule 57A is removed for home consumption or for e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of handling and they had become scrap. In certain other situations, the glass bottles generated defects due to repeated use and because of this, the glass bottles are rejected as waste. It was conceded by the appellants themselves that they sell glass bottles at regular intervals as waste and scrap. Since the appellants had availed of Modvat credit on the glass bottles as inputs under Rule 57A, the provisions of Rule 57F(5) are clearly attracted in such sale. Rule 57F(5) clearly provided that any waste arising from the processing of inputs can be removed only on payment of duty and by deeming fiction it had been provided that such waste was manufactured in the factory. There was no allegation that the appellants were manufacturing waste a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l was concerned. 6. We have considered the submissions and the case law relied on by the ld. Advocate for the appellants in support of his contentions. We find that the decision in Charminar Bottling Co. v. CCE Hyderabad [2000 (37) RLT 151] relied on by the appellant does not deal with the question raised in this appeal inasmuch as the said decision was in relation to the question whether breakages of duty paid glass bottles would attract duty under Chapter Heading 7001.10. In the case of B.P.L. Electronics v. CCE [1994 (71) E.L.T. 801], the question that was examined was whether duty exemption can be denied merely for the reason that the manufacturer had raised an invoice but used the goods within the factory of production. It was held t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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