TMI Blog2004 (5) TMI 574X X X X Extracts X X X X X X X X Extracts X X X X ..... ly used by them in their distillery formanufacture of Rectified Spirit and a part of it was also being sold,on payment of appropriate duty, to the buyer. The entire quantity ofmolasses either to their distillery or to the outside buyers wascleared on payment of duty. They took credit of duty paid on themolasses which was being captively consumed by them in theirdistillery for the manufacture of Rectified Spirit. The RectifiedSpirit is chargeable to nil rate of duty under Sub Heading 2204.90. Aportion of Rectified Spirit was also cleared as such to other partiesand a portion of the same was utilised by the appellants formanufacture of Denatured Ethyl Alcohol, Amyl Alcohol and Indian MadeLiquor in their distillery. The appellant has followed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te appearing for theappellants pleaded that the appellants are using Molasses as input intheir distillery for manufacture of Rectified Spirit falling underCSH 2204.90, Denatured Spirit falling under CSH 2204.10, Amyl Alcoholfalling under CSH 2905.90 and Fusel Oil falling under CSH 3824.90.The rectified spirit is chargeable to nil rate of duty whereas theremaining final products are cleared on payment of duty. Theappellants are also having a Liquor Manufacturing Section where theyare manufacturing Indian Made Liquor which is out of the purview ofthe Central Excise Tariff. The part quantity of rectified spiritmanufactured in their distillery is sold to other liquormanufacturers at nil rate of duty and the remaining quantity of therectified sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le 57CC on the said quantity of Rectified Spirit. In view of theratio of the said decision, their practice of reversing 8% amount onthe quantity of rectified spirit captively consumed in themanufacture of IML is correct. He, further, pleaded that in case ofKesar Enterprises Ltd. vs. CCE, Lucknow reported in 2002 (49) RLT 547(CEGAT - Del), identical issue has been decided wherein the Tribunalhas held that - Molasses used in manufacture of rectified spirit which iscaptively used in manufacture of non-excisabie country liquor -credit of duty taken in respect of molasses, not to be denied but tobe reversed @ 8% of the value rectified spirit. It was pleaded that since the issue has been finally decided bythe Tribunal in favour of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is applicable onlyto manufacture of products which are excisable. Therefore instead ofreversing 8% price of final product, i.e. rectified spirit, theappellants are required to reverse the entire credit taken on themolasses which has gone into rectified spirit which is in turn usedin the manufacture of IML. We find that the issue has already beendecided by the Tribunal in case of Kesar Enterprises Ltd. (supra)wherein it was decided that the appellants are entitled to availModvat credit on the molasses and they were liable to pay amount @ 8%of the value of rectified spirit being cleared for manufacture of IMLin terms of Rule 57CC of the Central Excise Rules. We also find thatin case of Commissioner of Central Excise, Lucknow vs. KesarEnterp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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