Re-rollable Materials of Non-Prime quality to be considered as Heavy Melting Scrap, Eligible for Exemption: CESTAT [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) Chandigarh last week ruled that Re Rollable material, which is not of prime quality should be categorized as Heavy Melting Scrap and thus made eligible for claim of Customs exemption under Notification No. 12/2012 dated 17.03.2012 (Serial No. 332), at the declared price as Rs. 380 per Metric Ton.

The Appellants Regal Alloy Pvt. Ltd imported Heavy Metal Scrap form M/s Padmashree Globe Tradelink Pvt. Ltd. on high sea sale basis. The Consignment was examined by the anti-smuggling Ludhiana unit and it was found that the same also contained re-rollable materials, apart from the Heavy Melting scrap.

The appellant filed appeals before Commissioner of Customs (Appeals) contending that the re-rollable materials are not of prime quality and they are imported as scrap only. But, the appeal with the above contention of the appellant was rejected.

The division bench Consisting of Technical Member Devender Singh and Judicial Member Wadhwa made Reference to the Tribunal decision in the case of Kuber Casting Pvt. Limited vs. CC, Amritsar – 2016 (339) ELT 264 (Tri. Chennai) and held, “the presence of re-rollable scrap will not convert the consignment into anything other than Heavy Melting scrap.”

The bench further relied on a decision of the Tribunal in a similar issue wherein the confiscation of the goods was set-aside by observing that the order was placed for Heavy Melting scrap only and the foreign supplier has sent Heavy Melting scrap only, the presence of re-rollable scrap will not convert the consignment into anything other than Heavy Melting scrap.