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TMI Blog2016 (3) TMI 156X X X X Extracts X X X X X X X X Extracts X X X X ..... e to Central Excise duty. During the course of this manufacture they produce slitted /sheared strips and captively used them in the manufacture of coaches which are exempted from payment of duty. The Revenue proceeded against the assessee on two grounds. A. The process of slitting /shearing resulted in manufacture of intermediate product CR sheets classifiable under 7209 30 and 7211 51 Since these sheets are captively used in the manufacture of final product which are exempted from payment of duty exemption for captively consumed goods available under notification No. 89/95-CE cannot be extended to these CR sheets. B. During the course of manufacture of railway coaches, the assessee generated melting scrap and claimed exemption under no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ptive consumption of CR sheets, scrap generated during the manufacture of railway coaches and the applicability of captive consumption of CR sheets and exemption under Notification No. 89/95 CE for waste and scrap of iron and steel. While dropping the demand of HR /CR coils, the adjudicating authority did not examine and properly appreciate the facts relating to duty liability of scrap. Except the one instance of export of 72 bogies to Vietnam, the assessee did not have any further export or dutiable clearance. Hence, the question of denying exemption of whole of waste and scrap generated during the whole impugned period is totally unsustainable. 5. During the course of argument, the learned Counsel for the assessee categorically stated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enable. It is nobody's case that even a single time clearance of dutiable item will disentitle the exemption on scrap for all time. Apparently, this is the effect of original order as the demand on scrap was confirmed for the whole impugned period denying the exemption. Such denial of exemption is not supported by legal provision when the assessee have all along manufactured and cleared railway coaches on exemption for home consumption except for one consignment of export. There is no other finding to the effect that the assessee has been clearing non-exempted goods so as to deny the exemption available to waste and scrap. We also find that in a separate proceedings the duty on waste and scrap attributable to coaches exported out of India h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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