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2013 (9) TMI 937 - ALLAHABAD HIGH COURTMODVAT Claim on the portion of Furnace Oil/LDO used for generation of electricity supplied to other units - Interpretation of Rules - Held that:- It was well-settled that tax law should be interpreted in conformity with the normal commercial practice - Therefore, the manner of use should be accepted as to economical, efficient and convenient manner of use. A contrary interpretation would lead to frustrating the purpose of law in granting exemption/Modvat credit - Relying upon In SRF Ltd. versus Commissioner of Central Excise, Chennai [2005 (7) TMI 215 - CESTAT, CHENNAI] and Mahabir Jute Mills Ltd. versus Commissioner of C. Ex., Allahabad [2006 (2) TMI 591 - CESTAT, NEW DELHI ]. The learned counsel produced various orders passed by the different Tribunals and they all do support the impugned order of the Tribunal - The learned counsel for the appellant could not refer any statutory regulation or rule to take a different view of the matter - It was logical that if two units were being run at one place, producing two different items and the electricity was supplied to both of them by a common generator, the Modvat facility shall be available to both the manufacturing units, unless statutorily provided otherwise - It was neither expedient nor desirable unless provided otherwise statutorily to have separate electricity generating sets for different manufacturing units - The approach of the Tribunal was pragmatic and in the interest of efficiency and economy – there was no error in allowing Modvat Credit on Furnace Oil and other eligible inputs used in the generation of electricity – Decided against the revenue.
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