M. Veeraiyan (T), Members ORDER
M. Veeraiyan, Member (T)
1. This appeal was heard pursuant to remand directions of the Hon'ble Supreme Court vide judgment reported in 2007 (212) ELT 3 (SC).
2. Heard both sides.
3. The relevant facts, in brief, are as follows:
a) The appellant is a manufacturer of matches following under chapter heading 360500. They manufacture 'match sticks' and also manufacture 'empty match boxes' (also referred to as printed paper board boxes) for packing the match sticks.
b) They buy duty paid paper and paper board for manufacture of such printed paper board boxes. During the course of manufacture of such empty match boxes, waste/scrap/parings of paper and paper board arises. Such scrap generated was sold for consideration.
c) During investigation, the officers recovered private records relating to stock and sale of such waste/scrap of paper or paper board. Show cause notice was issued holding that such waste material sold were classifiable under sub-heading 4702.90 and that appellant, did not file declaration under Rule 173B, did not issue invoices under Rule 52A, did not file details of clearances in the monthly RT-12 returns filed by them and proposing demand of a sum of Rs. 23,20,000/- relating to the period 1995-96 to 1998-99.
d) Commissioner vide impugned order confirmed the demand as proposed; ordered recovery of interest and imposed penalty of Rs. 23,20,000/- under Section 11AC.
e) The matter came before the Tribunal and the Tribunal vide order dated 28.11.2001 held that waste/parings generated out of duty paid paper and paper board was not new and distinct item and was not liable to levy of duty and allowed the appeal.
f) The Department filed appeal to the Hon'ble Supreme Court and Hon'ble Supreme Court vide order dated 05.10.2007 remanded the matter with the following observations:
14. Since CEGAT has not dealt with the factual scenario in detail and has abruptly come to an abrupt conclusion that no manufacture is involved, the matter is remitted to it for fresh consideration in the light of decisions referred to above.
4.1. Learned Advocate submits that the appellant is not a manufacturer of paper and paper board. They have procured duty paid paper and paper board from other manufacturers; they have not taken any cenvat credit of duty paid on paper and paper board. The waste scrap and parings were generated not during the course of manufacturing of paper and paper boxes but during the use of paper and paper board for manufacture of empty match boxes. They sold the waste paper and paper board at a very nominal price.
4.2. He relied on the following decisions to claim that the impugned goods are not excisable:
1. Kores India Ltd., v. CCE, Chennai MANU/SC/0999/2004
2. Shyam Oil Cake Ltd. v. CCE, Jaipur MANU/SC/1001/2004
3. CCE, New Delhi v. S.R. Tissues P. Ltd. MANU/SC/0461/2005
4. Union of India v. Parle Products P. Ltd. MANU/SC/0029/1994
5. Union of India v. Indian Aluminium Co. Ltd.-MANU/SC/0300/1995
6. CCE v. Indian Aluminium Co. Ltd. 2006 (203) ELT 3 (SC)
7. CCE, Markfed Vanaspati & allied Inds. MANU/SC/0296/2003