Circular No. 63/96-Cus.
dated 13/12/96
F.No. 605/ 285/ 96- Cus. VI
Government of India
Ministry of Finance
Department of Revenue, New Delhi

Subject:  Disposal of waste arising during the re-process of jobbing on material imported under Notfn. No. 81/95-Cus. dtd. 31.3.95

Notification No. 81/95- Customs dated 31.3.95 requires the waste including the resultant product to be re-exported after the inputs imported under the benefit of said notification have been subjected to the jobbing operation. Some representations have been received from the trade circles expressing difficulty in re- exporting the waste along with the resultant product as according to them re-export of the waste which has no commercial value is neither acceptable by the supplier of the material abroad nor viable to be retained by them and as such a request has been made to permit destruction of the waste arising during the process of jobbing.

2. The matter has been examined in the light of amendment of Notification No. 81/95-Cus under Notfn. No. 35/96-Cus. dated 11.7.96 according to which the jobbing operations were required to be carried out in accordance with provisions of sections of section 65 of the Customs Act, 1962. It is stated that there are inbuilt provisions under section 65(2) of the Customs Act, 1962 which provides the manner the waste of refuse can be dealt with or destroyed. It is further stated in this regard that the provisions of section 65 were introduced under Notfn. No. 35/96-Cus. with effect from 11.7.96 and continued till its amendment by Notfn. No. 87/96-Cus. dtd. 18.11.96 according to which the old position prior to 11.7.96 was restored i.e. the jobbing operations were no longer required to be undertaken in accordance with Section 65 of the Customs Act, 1962. As far as the destruction of waste in respect of imports during the period 11.7.96 to 17.11.96 is concerned, there should not be any difficulty in permitting the destruction as the same was required to be done in accordance with provision of Section 35(2) of the Act. The problem, therefore, is only with regard to the imports prior to 11.7.96 and after 17.11.96 under Notfn. No. 81/95-Cus.

3. The matter has been considered by the Ministry and it has been decided that the waste way be allowed to be destroyed under the supervision of the Central Excise authorities only in respect of those types of wastes which have no commercial value. While permitting the destruction, it may be ensured that the quantum of wastage so destroyed is genuine and that no part of the finished goods in the guise of wastage have been diverted to the local market.

4. Commissionerates are requested to issue suitable Public Notice/ Standing Order for information of trade/ departmental officers.

(S.P. Srivastav)
Commissioner (Drawback)

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