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2016 (3) TMI 944 - CESTAT NEW DELHI

2016 (3) TMI 944 - CESTAT NEW DELHI - TMI - Recovery of cenvat credit - Returned goods - non maintenance of separate accounts of receipt and utilization of inputs used in dutiable and exempted final products - Demand of 8% amount on the value of exempted acid oil - Held that:- In the impugned order that Sulphuric Acid has been used in the manufacture of Acid Oil from soap stocks. This process is separate and independent of manufacture of refined edible oils. During the manufacture of edible oils .....

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as per the entries in the RG-I is not possible in a unit having huge turnover. He observed further that the appellants have entered all the returned goods in the RG-I and taken back the credit of excise duty paid. There is no need to maintain separate records for returned goods. The appropriate duty has been paid when the returned goods were cleared. The ld. Commissioner (Appeals) recorded that the respondents produced copies of RG-I register and the respondent's claim regarding proper accounti .....

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e Respondent : Shri R. Sudhinder, Advocate ORDER PER B. RAVICHANDRAN: The appeal by Revenue is against order dated 31.07.2006 of Commissioner (Appeals-I), Central Excise, Indore. The Respondents are engaged in the manufacture of soya/palm/palmolein refined oil and vanaspati. They are availing credit of duty paid on various inputs. They have not maintained separate accounts of receipt and utilization of inputs used in dutiable and exempted final products. Hence, proceedings were initiated against .....

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oil obtained after reprocessing is not entered in the RG-I register. 2. On appeal, the Commissioner (Appeals) allowed the respondents appeal relating to demand of 8% amount on the value of exempted acid oil. He held that the respondents have reversed the entire credit taken in respect of Sulphuric Acid and hence there is no justification for a further demand of a percentage amount on exempted final products. On demand regarding improper maintenance of accounts of receipt of re-processed goods, .....

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Oil. It is an admitted fact that the Acid Oil is manufactured from soap stock using Sulphuric Acid. The soap stock is a by-product emerging during the course of manufacture of refined oil and was exempted vide Notification No.115/75-CE. Various inputs like Phosphoric Acid, Caustic Soda, etc. are used in the manufacture of refined oil. Hence, reversing credit availed on Sulphuric Acid does not absolve the respondents from the liability to pay 8% of value of exempted goods. Regarding improper acc .....

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l apply in respect of inputs, which are used by way of raw materials in the manufacture of principal product and not to the waste which incidentally emerge during process of manufacturing principal product. The soap stock emerges as inevitable incidental by-product and hence, the provision of Rule 6 is not attracted in such situation. Reliance was placed on the Tribunals decision in the case of Rama Industries Ltd. - 2004 (178) ELT 720 (Tribunal-Delhi). 7. We have heard both the sides and exami .....

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