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TMI Blog2012 (11) TMI 355X X X X Extracts X X X X X X X X Extracts X X X X ..... 26/2011-WZB/AHD - Dated:- 22-11-2011 - Shri M.V. Ravindran, Dr. P. Babu, JJ. REPRESENTED BY : Shri S.K. Mall, AR, for the Appellant. Shri Willington Christian, Advocate, for the Respondent. [Order per : M.V. Ravindran, Member (J)]. This appeal is filed by the Revenue against the order in Appeal No. Commr(A)/185/VDR-II/2010, dated 29/30-7-2010. 2. The brief facts that arise for consideration are that, the respondent assessee is manufacturing Plastic Shoe Lasts, which are cleared on payment of duty. For manufacturing this final product, respondent used various plastic granules procured on payment of duty and availed credit of such duty paid under Cenvat Credit Rules, 2004. During the course of manufacturing finished prod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d scrap of plastic only and hence this reasoning of the first appellate authority is erroneous. It is his further submission that as per Serial No. 78 of the Notification No. 04/2006-C.E., dated 1-3-2006, plastic granules reprocessed out of scrap or waste of products under Chapter 39 are exempted. It is his submission that the assessee has no other choice but to claim exemption of such goods i.e. of reprocessed plastic granules and in that case, the flakes or waste and scraps i.e. plastic granules are leviable for duty. It is his submission that the duty paid by the assessee on the clearances of reprocessed plastic granules should be considered as deposit and not as duty. He prays that the impugned order be set-aside. 3. Learned counsel a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakes which arise during the course of manufacture of their final products, which is again not marketable one, as these products are used by them for manufacturing of shoes. 6. The undisputed facts are that the respondent assessee used almost all of their reprocessed granules in the further manufacturing of shoe last, while a minor quantity of the reprocessed granules is cleared on payment of duty to their sister concerns and other firms. 7. We find that the entire case of the Revenue is that reprocessed granules cleared by the assessee on payment of duty are not liable to duty by virtue of Notification No. 04/2006, which has been issued under the provisions of Section 5A(1A) of the Central Excise Act, 1944. Since they are not liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rap or the waste of goods falling under Chapter 39, 54, 56 . Waste and scrap by definition are materials which are discarded and are not useable in the particular industry. Flakes and Shavings arising in the process of manufacture of Plastic Shoe Lasts is recycled and is work in process and cannot be considered as waste and scrap. The exemption under notification No. 4/2006 (Sl. No. 78) is available to plastic materials manufactured in factory using waste and scrap of goods falling under Ch. 39, 54 etc. as input. In the case in hand, the reprocessed granules are generated in the factory using virgin plastic materials as inputs. The benefit of exemption under Notification No. 4/2006 (Sr. No. 78) cannot be extended to the reprocessed granule ..... X X X X Extracts X X X X X X X X Extracts X X X X
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