Per P.C. Jain :

Briefly stated the facts of the case are as follows:-

1.1. The appellants herein obtained waste and scrap of copper from M/s. Hindustan Cables, which arose during the course of manufacture of cables out of the duty-paid imported/indigenous copper bars and rods. There is no dispute that the waste and scrap of copper cleared by M/s. Hindustan Cables to the appellants herein, were not liable to duty in terms of Notification No. 172/84-CE dated 1.8.84.

1.2. The appellants after melting the said waste and scrap manufactured the copper ingots therefrom. Thereafter, the appellants sent the copper ingots so manufactured by them, to a job worker who rerolled the ingots into copper bars and rods which were returned by the job worker to the appellants herein. Those copper bars and rods were then sent by the appellants to M/s. Hindustan Cables.

1.3. A question has arisen about the duty liability of the copper bars and rods so manufactured, as mentioned above. Revenue has charged duty on copper bars and rods in terms of Notification No. 175/84-CE.

1.4. Appellants' contention on the other hand, is that they are not liable to pay any duty because they have manufactured only copper ingots and they are clearly covered by the provisions of Notification No. 174/84 dated 1.8.84. There is no liability devolved on them on manufacture of copper ingots. They contend that copper bars and rods were manufactured by their job worker. If at all, any duty is payable under the said Notification No. 174/84-CE, it would be payable by the said job worker and not by them. On the other hand, the Department contends that the job worker has made copper bars and rods on behalf of the appellants herein. Therefore, for all intents and purposes, the appellants herein are the manufacturers of the said copper bars and rods. Hence, they are liable to pay duty. It is their agreement with M/s. Hindustan Cables that they would supply the copper bars and rods made out of the waste and scrap supplied by M/s. Hindustan Cables to the latter. Therefore, they are to be treated as manufacturers. Job worker is not treated as a manufacturer because job worker has done the work at the direction and dictate of the appellants herein.

1.5 Another ground taken by the concerned Commissioner for denying the benefit of the Notification No. 174/84-CE dated 1.8.84 is that copper waste and scrap are clearly recognisable as non-duty paid. Therefore, the copper bars and rods cannot get the benefit of the said Notification because the said Notification, inter alia, provided a condition that the said goods are made from copper and products thereof, on which duty of excise leviable under the said Act (Excise Act) was the additional duty liability on the importers or the customers as the case may be, has already been paid. Since the waste and scrap is recognisable as non-duty paid, having been cleared on non-duty paid gate passes by M/s. Hindustan Cables, this condition is not satisfied. Hence the finding of the adjudicating authority.

2. We have heard both sides and considered their pleas carefully.

2.1. As regards the ground taken by the adjudicating officer regarding non-fulfilment of the duty-paid character of the waste and scrap as mentioned above, we state that this position is no longer a valid position in view of the Apex Court's judgment in the case of C.C.Ex. Vs. Usha Martin. The goods, even though cleared under exemption on nil duty gate passes, are to be deemed to have been cleared on appropriate duty and are to be considered to have paid duty. Therefore, the condition impugned by the adjudicating authority in the impugned Order is fully satisfied.

2.2. As regards the demand of duty of copper bars and rods from the appellants, we observe that the said demand of duty cannot be made against the appellants herein. There is no finding that the job worker was acting under the supervision, direction and control of the appellants herein and that the said job worker was merely dummy