9911796707
TMI Blog1983 (10) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... The bun is cut into smaller blocks which are later cut into articles of desired shape and size. Sometimes, smaller blocks are bonded together with adhesive to form large sized articles like mattresses. Cutting and trimmings arise in the process of cutting of bun into blocks and of blocks into articles etc. These cuttings and trimmings are also used by the appellants for manufacture of articles of polyurethane foam by further cutting and bonding the pieces together. The appellants call these cuttings and trimmings as waste and scrap. During the hearing before us they quoted from three books, Bayer-Plastics, Bayer-Polyurethanes and Advances in Urethane Science and Technology by K.C. Frisch and S.L. Reegan to show that these process cuttings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h waste and scrap of synthetic resins and plastic materials were specifically included in the scope of Item 15A(1). In 1981 Budget, waste and scrap of certain metal items were also added in the Tariff by insertion of specific entries in the respective metal tariff items. But there was no similar amendment to entry 15A(3) relating to polyurethane foam. Explanation III below Item 15A was not applicable to the appellants as waste and scrap of polyurethane foam was not covered by entry 15A(1). (2) Waste and scrap was an involuntary arising-a residual product coming into existence incidentally and not involving a process of manufacture and hence not chargeable to duty. In support of this argument, they relied on the following case law - (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entry. The reason why it was considered necessary to include waste and scrap in entry 15A(1) by means of Explanation III was because of the highly technical and scientific wording of the said entry. On the other hand, entry 15A(3) Polyurethane foam was a very simple one. As the Central Excise Tariff was not based on the CCCN, Section Notes and Chapter Notes of the CCCN were not relevant to interpret the entries in the Central Excise Tariff. In any case, what the CCCN stated was that waste and scrap of synthetic resins and plastics remained covered within Chapter 39. He distinguished the authorities cited by the appellants saying that the cases covered by these authorities were of refuse, scum or rubbish (dross and skimmings of aluminium) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idental arisings is, therefore, misplaced. The dispute here is not whether any new product comes into existence but whether cuttings and trimmings continue to remain polyurethane foam for the purpose of the Tariff entry 15A(3) or not. As regards the appellants argument that no duty can be charged on waste and scrap, we agree with the Department s representative that as commonly understood waste and scrap means something which cannot be used for the purpose for which the parent material is used and, therefore, has either to be thrown away or re-cycled. Such is not the case here. To quote from the book, Bayer-Plastics relied on by the appellants themselves, Scrap produced in the manufacture and subsequent processing of Moltopren may be re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fectionary. The various small buyers who purchased these bits and dusts usually melted the same to extract sugar for the purpose of preparing cheap syrups used in preparation of low grade sweet-meats. The said scrap was not known or sold in the market as confectionary. The High Court held that the scrap could not be taxed as finished product if it was obtained in the course of manufacture and not out of manufacture of finished product because if the raw material underwent some change in the process of manufacture it could not be equated with the finished product. In 1980 E.L.T. 146 (Bombay), the dispute related to dross and skimmings which the High Court held were merely refuse, scum or rubbish thrown out in the process of manufacture of al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m raw material and, therefore, any by-product or intermediate or residual product in the manufacture of particular goods will be covered by the word `production . 8. The appellants have stated that various tariff items relating to metals were amended and a separate sub-item relating to waste and scrap was put in them but that no such amendment has been made in the case of Item 15A(3). The reason for this could be that various sub-items in the concerned metal items (26A, 26B, 27 etc.) applied to specified forms of those metals and some doubt or difficulty might have been felt in fitting waste or scrap into the particular forms described in the tariff. There is, however, no such doubt or difficulty in the case of Item 15A(3) as no form or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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