TMI Blog2009 (9) TMI 851X X X X Extracts X X X X X X X X Extracts X X X X ..... k credit of duty paid on them. The assessee cannot be denied credit on the ground that co-generation plant produced non-dutiable electricity and electricity was the final product at the time of receipt of equipment required to set up the power plant. On erection of the entire facility, dutiable excisable goods were the final products manufactured using, inter alia, electricity produced by the co-generation plant. It is immaterial that owing to delay in receiving certain approvals required, the sugar mill became fully operational in January, 2004 whereas the co-generation plant was operational a year earlier. The appellants eligible for the impugned credit - appeal allowed - decided in favor of appellant. - E/333/2009 - 1169/2009 - Da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MW power during season and off season respectively, and would supply 9.99 MW and 16.94 MW to APTRANSCO during season and off season. The impugned order is based on sub-rule (4) of Rule 6 of CCR. This rule reads as follows :- No Cenvat Credit shall be allowed on Capital Goods which are used exclusively in the manufacture of exempted goods, other than the final products which are exempt from the whole of the duty of excise leviable thereon under any notification where exemption is granted based upon the value or quantity of clearances made in a financial year. 2. Heard both sides. 3. We observe from the records that the co-generation plant became operational ahead of the sugar mill and during the period 1/2003 to 20-1-04, entire powe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held it to be so. If the machinery were used in the manufacture of exempt final products on the date of their receipt, credit would not be available. I.G. Petrochemicals Ltd. cited by the Revenue does not deal with Cenvat credit but exemption under EOU scheme when the capital goods were deployed to produce electricity which was almost entirely sold to State Electricity Board. This decision is not relevant to the issue at hand. 4. In the Surya Roshini case (supra), the tribunal observed in paragraph 5 of its decision as under :- 5. ...... The availability of Modvat credit is to be looked into at the time of receipt of the capital goods. If the capital goods are exclusively used in the manufacture of exempted products, Modvat credit will ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal filed by the Revenue. As per the above observations, the impugned goods used to set up power plant to generate power for intended eventual use in the production of dutiable excisable goods are eligible for capital goods credit. Co-generation plant was to produce power for consumption in the sugar mill. It cannot be held that dutiable goods such as sugar and molasses were not the final products of the assessee on the date of receipt of the impugned capital goods. That on the date of receipt of the impugned goods, the sugar mill was not operational cannot disentitle the assessee to credit. The ratio of decision of the Larger Bench in Spenta International Ltd. case cannot be correctly applied to deny the impugned credit. Here the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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