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Commissioner of Central Excise, Raipur Versus M/s. Aarti Sponge and Power Ltd. And Shri Vasvani Industries Ltd.

2015 (12) TMI 1445 - CESTAT NEW DELHI

Reversal of cenvat credit - some iron ore fine or smaller pieces of iron ore emerge which are not usable for further manufacture of sponge iron. Therefore, same were cleared without payment of duty - duty on 10% of the value of exempted goods cleared by the respondents - Held that:- As the facts of the cases in hand are identical to the facts of the case in Maa Mangla Ispat Pvt.Ltd. (2013 (5) TMI 268 - CESTAT NEW DELHI), and after examining the impugned order, in the light of the decision in the .....

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round that the learned Commissioner (Appeals) has fell in error by setting aside the adjudication order demanding duty on the amount of 10% of the value of exempted goods cleared by the respondents. 2. The facts of the case are that the respondent are engaged in activity of manufacturing of sponge iron. To manufacture sponge iron, the appellant procured iron ore fine. After processing the goods, sponge iron is manufactured and some iron ore fine or smaller pieces of iron ore emerge which are not .....

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against the respondent which were adjudicated and demand was confirmed against the respondent along with interest, penalties were imposed. The said orders of learned adjudicating authority were challenged by the respondents before the learned Commissioner (Appeals) who examined the issue and held that the goods which are cleared by the respondent without payment of duty are neither manufactured goods nor exempted goods. Therefore, provisions of Rule 6(3) are applicable to the facts of the case. .....

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taining separate account for dutiable as well as exempted final product, therefore they are liable to pay 10% of the value of goods in question. In these circumstances, impugned orders are required to be set aside. 4. On the other hand, learned counsel appearing for the respondents Shri Rupinder Singh, submits that provisions of Rule 6(3) are not attracted in the facts of the case as the respondents are not manufacturer of iron ore fine. They are manufacturer of sponge iron and these are by-prod .....

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ade from both sides and perused the record. In this case, the iron ore fine emerges as an inevitable waste while screening and sieving the iron ore for removal of smaller particles prior to manufacture of sponge iron. The provisions of Rule 6(2) and Rule 6(3) of Cenvat Credit Rules, 2004 are applicable when a manufacturer consciously manufactures two products - an excisable and the other fully exempted product using common inputs and/or input services. In such circumstances, in terms of the prov .....

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