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2015 (10) TMI 1558 - CESTAT NEW DELHI

2015 (10) TMI 1558 - CESTAT NEW DELHI - TMI - Denial of CENVAT Credit - appellant availed cenvat credit on the cement used for treating the effluent jarosite before dumping it in the land fill - Held that:- In Indian Farmers Fertilisers Coop. Ltd. (1996 (7) TMI 141 - SUPREME COURT OF INDIA), the issue came up before the Hon'ble Apex Court for directions to agricultural plant wherein the Apex Court has held that the apparatus used for treatment of effluent in a plant manufacturing a particular en .....

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2012, Excise Appeal Nos. 50426, 50675,50677, 50678 of 2014 - A/52585-52589/2015-EX(DB) - Dated:- 13-8-2015 - Ashok Jindal, Member (J) And B Ravichandran, Member (T) For the Appellant : Shri B L Narsimhan, Shri Kipul Agarwal, Advs For the Respondent : Shri M S Negi, DR ORDER Per Ashok Jindal The appellant is in appeals against the impugned orders denying cenvat credit consequently demand of duty along with interest and imposition of penalty. As issue involved is common in all the appeals, therefo .....

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e appellant availed cenvat credit on the cement used for treating the effluent jarosite before dumping it in the land fill. The Revenue is of the view that since exclusive use of cement was to treat the effluent and it was not used in connection with the manufacture of final product, therefore, appellant is not entitled to take cenvat credit on cement so used. On the said allegation, several show cause notices were issued to deny the cenvat credit on the cement. Those show cause notices were adj .....

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impugned orders. 5. Heard the parties. Considered the submissions. 6. In the case of Indian Farmers Fertilisers Coop. Ltd. (supra), the issue came up before the Hon'ble Apex Court for directions to agricultural plant wherein the Apex Court has held that the apparatus used for treatment of effluent in a plant manufacturing a particular end-product is a part and parcel of the manufacturing process of end-product. We further find that Hon'ble Apex Court has observed as under: "6. The .....

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being essential for the protection of the boiler and other process equipment from corrosion, formation of scales, etc., the ammonia used for the purpose could not be said to be used in the manufacture of fertilisers. The view of the Collector, insofar as the effluent treatment plant was concerned, was upheld. 8. For our conclusion we draw support from the judgment of this Court in Collector of Central Excise, Calcutta-II v. Eastend Paper Industries Ltd.-1989 (43) E.L.T. 201 = 1989 (4) SCC 244 , .....

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0. It was there held, "The expression "in the manufacture" takes in within its compass, all processes which are directly related to the actual production". In Collector of Central Excise, New Delhi v. M/s. Ballarpur Industries Ltd.-(1984) 4 SCC 566, the respondent manufactured paper and paperboard, "in the processes relating to which "sodium sulphate" is used in the chemical recovery cycle of sodium sulphate which forms an essential constituent of sulphate cook .....

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other components which go into the making of the end-product ........." and observed that, correctly apprehended, that statement did not lend itself to the understanding that for something to qualify itself as a raw material it had necessarily and in all cases to go into and he found in the end-product. The court also quoted with approval the case of Eastend Paper Industries Limited cited above. 9. That leaves us to consider whether the raw naphtha used to produce the ammonia which is used .....

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uents in a plant manufacturing a particular end-product is part and parcel of the manufacturing process of that end-product. The ammonia used in the treatment of effluents from the urea plant of the appellants has, therefore, to be held to be used in the manufacture of urea and the raw naphtha used in the manufacture of such ammonia to be entitled to the said exemption." 7. Further, the Hon'ble Madras High Court in the case of CCE, Coimbatore vs. Madras Aluminium Company Ltd. [2008 (226 .....

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Indian Farmers Fertiliser Co-operative Ltd. v. C.C.E., Ahmedabad, 1996 (86) E.L.T. 177 (S.C) - AIR 1996 SC 2542 . In that case raw naptha was obtained at the concessional rate and used for producing ammonia which in turn was used partly, directly in the urea plant and partly, indirectly in the production of urea by being employed in off-site plants, namely, water treatment plant, steam generation plant, inert gas generation plant and effluent treatment plant, all of which were part of the integr .....

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me Court held as follows: "9. That leaves us to consider whether the raw naphtha used to produce the ammonia which is used in the effluent treatment plant is eligible for the said exemption. It is too late in the day to take the view that the treatment of effluents from a plant is not an essential and integral part of the process of manufacture in the plant. The emphasis that has rightly been laid in recent years upon the environment and pollution control requires that all plants which emit .....

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