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2024 (2) TMI 302 - MADRAS HIGH COURTReversal of proportionate CENVAT credit - generation of electricity - CENVAT credit of Counterveiling Duty (CVD) on import of Coal - quantum of power wheeled out to sister units - HELD THAT:- The narration of facts as captured in paragraphs 1 and 7 of the judgment in Maruti Suzuki [2009 (8) TMI 14 - SUPREME COURT] is to the effect that the supply of electricity in that case was to sister concerns, vendors and third parties, and at cost. Thus, the Court was concerned with the factual scenario where the power was sold to other units and whether, in such circumstances, such sale would qualify for the claim of CENVAT credit. In the present case, the electricity has not been sold but has been supplied though wheeling by TANGEDCO to sister units located elsewhere. All units are engaged in manufacture/grinding of cement and form part of the same group of companies. They admittedly hold separate licenses for manufacture and are independent assessees - the facts that the power in this case has not been sold for consideration and has only been shared with the sister units will be a relevant consideration. Importantly, a distinction has been envisaged between the goods used 'in the factory' by the 'manufacturer of the final product' and the goods used for 'generation of power'. While the former insists that the goods must be used 'in the factory', there is no stipulation of place as regards the goods in clause (iii). Therefore, there are merit in the position that electricity captively generated is an input, wherever used by the assessee concerned. The use of the term ‘captive’ is, in our view a qualification of the location where it is generated and not of the location where it is used. The appellant must succeed on the specific fact pattern as arising in this appeals. These appeals are allowed.
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