GREYSHAM AND CO. Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) BRIEFLY stated. Facts of the case are as follows:

(2.) THE appellants herein are manufacturing the railway parts falling under Tariff Sub -heading 8607.00. The raw material used for the manufacture of these parts are steel and pig iron on which the appellants are availing the benefit of Modvat credit. The process involved in the manufacture of such railway parts includes forging, machining, boring, turning, threading and grinding etc. Some of these processes are undertaken through various job workers to whom the raw material i.e. steel and pig iron are sent for such processes.

(3.) THE appellants are having the permission under Rule 57F of the Central Excise Rules, 1944 for sending the inputs to their job workers after taking Modvat credit on their own. It is not disputed that in the course of manufacturing the railway parts, waste and scrap arises in the appellants' factory or in the job workers' factories. It however appears that the appellants did not clear the waste and scrap from their factory, so arisen, on payment of duty or did not bring the waste and scrap from their job workers to their factory and then clear the same on payment of duty. A show cause notice was therefore issued on 26 -3 -1993 asking the appellants as to why the duty of Rs. 2,95,221/ - be not recovered for the period April, 1988 to December, 1991 on the waste and scrap so arisen either in their own factory or in their job workers premises and on which the duty was not paid at all. On adjudication the adjudicating authority has confirmed the aforesaid amount of duty and has also imposed a penalty of Rs. 5,000/ - on the appellants. Hence this appeal before the Tribunal.