H.R. Syiem, Member (T)

1. The learned counsel for the department Mr. Rajhans began his arguments by quoting a decision of the Supreme Court in MANU/SC/0123/1985 : 1985 (20) ELT 222 (S.C.); 1985 ECR 2571 (Khandelwal Metal Engineering Works and Anr. v. Union of India and Ors.) in which he said the Supreme Court approved the assessment of scraps under their respective heads. He than read the order of the Assistant Collector and pointed to various paragraphs to support his argument that the scrap should be charged to duty under Item 68.

2. The learned counsel for M/s. Aluminium Industries however submitted that there was no manufacturer and that the goods remained aluminium. The scrap came from duty paid aluminium and therefore no further duty is leviable on them. There have been various decisions of courts that scrap was not dutiable. The Supreme Court in its decision quoted by the JDR was only considering the question of countervailing duty; this decision was not relevant to this dispute. He then read the Tariff Item 27, and quoted 1980 ELT 789. In 1980 ELT 146 Indian Aluminium Co. Ltd. and Anr. v. A.K. Bandyopadiyay and Ors. , the Bombay High Court ruled that dross and skimmin