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TMI Blog2018 (7) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... ssesses, against the respective orders, since involve common issues are taken up together for disposal. 2. The facts almost common to all these appeals broadly can be stated as under: the assessees-appellants herein are 100 % Export Oriented Units and engaged in the manufacture of Brass articles. During the relevant period, the assessees-appellants had imported Brass Metal Scarp containing other impurities, without payment of duty, as per Notification No. 52/2003 Cus. dated 31/03/2003, as amended. The said scrap later segregated into foundry and non-foundry scrap; the foundry scrap was used in the manufacture of brass products, whereas the non-foundry scrap containing other impurity like rubber, plastic etc. sold in the DTA on discharge of appropriate excise duty. In these batch of Appeals, demand notices have been issued mainly on two grounds alleging that: (i) since segregation of imported brass scraps into foundry and non-foundry did not result into manufacture, as per CBEC circular No 62 of 2001 dt. 12/11/2001, consequently, the clearance of non-foundry scrap, in DTA on payment of applicable excise duty, is in contravention of Notification No. 53/2003-Cus dt.31.3.2003, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y permission from the Development Commissioner. 6. Ld. AR for the Revenue submits that in the CBEC circular dated 12/11/2001, it has been clarified that segregation of imported mixed scrap of plastic waste and other impurities, not a manufacturing operation, therefore, the non-foundry scrap generated during the course of segregation of mixed imported brass scrap accordingly, also not a process of manufacture, hence, on its clearance in DTA, appropriate customs duty on the value of imported scrap is payable as the condition of Notification No.50/2003Cus. dt.31.3.2003, as amended, has been violated by not utilizing the same in the manufacture of finished goods, but cleared 'as such' in DTA. 7. The Ld. Advocates, supporting the order of the Ld. Commissioner (Appeals), on the issue of segregation of imported mixed scrap, into foundry and non foundry scrap held to be resulted into manufacture, have submitted that segregation of imported mixed scrap, consisting of brass, rubber, plastic etc. meant to be utilized in the factory for melting and manufacture of brass articles, into foundry and non foundry grade of scrap has been considered as part of process of manufacture of brass article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Circular is a clarification on the issue of segregation of impurity, namely ,iron, steel, rubber, plastic, dust etc. from honey grade brass scrap imported, albeit in the context of Rule 3(5) of CENVAT credit rule 2004, but definitely applicable to the present case. It is clarified as follows: "3. The issue has been Segregation from honey grade scrap in order to weed out other foreign materials before the process of melting in the furnace is an essential process relating to manufacture of brass articles. The foreign materials, emerging during the process of segregation have to be treated as process waste and cannot be treated like removal of inputs as such. The segregated foreign material has an altogether different character and use vis-à-vis brass scrap. Value per unit and classification of the segregated foreign material is also different from that of imported brass scrap. Accordingly, clearance of foreign material such as iron, steel, rubber, plastic, dust etc. cannot be treated as clearance of inputs as such. It may be noted that circular No. 62 /2001 -CUS dated 12/11/2001 does not apply to the issue at hand as the facts at hand are different. 4. in view of above, it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or make it suitable to feed into the furnace for manufacture brass ingots, and then finished goods, in our view is a process integrally connected to the manufacture of brass articles. Besides, this Tribunal in the case of Singh scrap Processor Ltd. Vs, Commissioner of C.Ex. 2002 (143) ELT 619(Tri.-Mumbai) held the process of removal of impurity results into manufacture. Accordingly, the non-foundry scrap cleared in DTA on payment of excise duty, cannot be construed clearance of imported scrap 'as such'. 13. On the issue of payment of duty on the excess use/consumption scrap material, in the activity of segregation/manufacture of finished goods, then the norms fixed by the norms committee or mentioned in the Notification, as the case may be, we find that the Ld. Commissioner(Appeals), in his subsequent Orders, has rightly referred to and relied upon clause (3) of the said Notification. For better appreciation the said clause is reproduced as below: "3. Notwithstanding anything contained in this notification, the exemption herewith shall also apply to goods which on importation into India or procurement, are used for the purpose of manufacture of finished goods or services and such ..... X X X X Extracts X X X X X X X X Extracts X X X X
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