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2009 (7) TMI 622 - AT - Central ExciseCenvat Credit- Inputs- Appellant M/s. Vishwanath Sugars Ltd. Belgaum (VSL) were engaged in the manufacture of Rectified Spirit and Denatured Ethyl Alcohol. Pursuant to a visit to the premises of the appellant’s factory on 14-5-2004, officers of the department observed that VSL were engaged in the manufacture of rectified spirit and had availed inadmissible input credit of duty paid on Molasses, Furnace oil and Yeast. After due process of law, the Commissioner adjudicated the show cause notice issued to them and disallowed Cenvat credit under Rule 12 of Cenvat Credit Rules, 2001/2002. As the appellant had already reversed an amount of Rs.1,45,29,161/- (Rupees one crore forty-five lakh twenty-nine thousand one hundred and sixty-one only) on clearance of rectified spirit, the Commissioner appropriated the balance credit of Rs.83,56,155/- (Rupees Eighty-three lakh fifty-six thousand one hundred and fifty-five only). The period of dispute is September 2001 to 14th May, 2004. held that- The Commissioner held that such procedure prescribed under Rule 6 of CCR did not apply to the appellants as it had manufactured only rectified spirit, for in his view, denatured spirit came into existence by the sole process of mixing rectified spirit with toxin. We are unable to agree with the Commissioner that the appellants had not manufactured denatured spirit, a dutiable item along with rectified spirit both of which were cleared by the appellants. In these circumstances, we hold that the impugned order denying Cenvat credit availed on inputs received by the appellants in terms of Rule 6 of CCR is in accordance with law. In these circumstances, we find the impugned order to be contrary to legal provisions. The same is set aside and this appeal allowed
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