CCE Vs. BHUSAN STEEL & STRIPS LTD.

JUDGEMENT

(1.) IN these two appeals preferred by the Revenue the issue involved is whether the slitting/cutting of coils/sheets are coils and sheets only of lesser width and M/s. Bhushan Steel & Strips Ltd. the Respondents, are required to clear the slitting/cuttings after paying the amount of duty equivalent to the Modvat Credit availed of. Shri A.S. Bedi, learned SDR, submitted that the Respondents after availing of Modvat Credit are slitting/cutting HR Coils/Sheets in required width; that such slitted coils/sheets are used in the manufacture of black pipes and tubes and are not being used for re -melting, etc.; that therefore, such cuttings cannot be called as waste and scrap in view of the definition of waste and scrap given in Note 6 to Section XV of the Schedule to the Central Excise Tariff Act; that the Commissioner Central Excise (Appeals) following the decision of the Supreme Court in the case of LML Ltd. v. CCE,, 1997 (94) ELT 273 (SC) :, 1997 (72) ECR 267 (SC) and Tribunal's Final Order No. 939 -947 2000 -B dated 16.6.2000 in the Appellants own case has held that no differential duty is payable by the Respondents as these were not the inputs as received by the Respondents. The learned SDR, further, submitted that the decision in LML case has been wrongly interpreted by the Commissioner (Appeals) and the Tribunal's Order relied upon by the Commissioner (Appeals) has not been accepted by the department and Civil appeal in the Supreme Court has been admitted.

(2.) On the other hand Shri Rajesh Chhibber, learned Advocate, submitted that the judgment of the Supreme Court in LML case is squarely applicable to the facts of the present matter; that further the Tribunal in Final Order No. 939 -947 2000 -B dated 16.6.2000 has held that slittings are classifiable as shapes; that in view of these decisions impugned Order passed by the Commissioner (Appeals) is correct. We have considered the submissions of both the sides. The facts which are not in dispute are that HR coils/sheets are brought into factory and they are cut into required size. The classification of such cuttings is the issue involved in the present appeals. The Supreme Court in the case of LML Ltd. v. CCE, Kanpur has held that "definition of the word 'sheet' as contained in Chapter 72 would clearly indicate that the cut sheet which are used by the Appellants do not fall under that category." The Supreme Court also held that "portions of cut sheet which are used in the manufacture of ancillary items cannot be regarded as waste and scrap." Finally the Apex Court held that "these off cuts are of different shapes and sizes........and they would clearly fall under Chapter Entry 72.10 (Shapes and Sections) at the relevant time." Following the ratio of the said judgment this Tribunal has held in the Respondents own case that side slitting, end cuttings, and trimmings will be classifiable as shapes. Merely because the Revenue has filed an appeal in the Supreme Court, the Tribunal's decision does not cease to be applicable in absence of any stay order. The Commissioner (Appeals) has passed the impugned Order following the Tribunal's decision and as such we do not find any infirmity therein. We, therefore, reject both the appeals.