TMI Blog2012 (5) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by evidence and is based on unwarranted assumption. The department has failed to establish that the appellant used Cenvatable inputs for production of baggase. Once it is concluded that the department has failed to establish that the appellant used Cenvatable inputs for manufacture of bagasse, Rule 6(2) and Rules 6(3)(i) & (ii) of Cenvat Credit Rules, 2004 are not attracted. Appeal allowed - decided in favor of appellant. - E/1106/2012-EX(DB) - Final Order No. A/600/2012-EX(DB) and Stay Order No. 838/2012-EX(DB) - Dated:- 9-5-2012 - Ajit Bharihoke, President and Shri Rakesh Kumar, Member (T) Shri Rajesh Chhibber, Advocate, for the Appellant. Shri I. Beg, AR, for the Respondent. ORDER [Order per : Ajit Bhari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal which was rejected by the Commissioner (Appeals) vide impugned order dated 25-2-2012. 2. Feeling aggrieved with the impugned order, the appellant has preferred this appeal. 3. Learned Counsel for the appellant has submitted that the impugned order as also the order-in-original suffers from infirmity as orders are based on the incorrect appreciation of facts and incorrect application of Rule 6 of Cenvat Credit Rules, 2004. It is submitted that the appellate authority has failed to appreciate that bagasse and press mud are inevitable waste generated at the initial stage of crushing of sugar cane or extracting juice which is basic raw products for manufacture of sugar and molasses. Thus, it cannot be said that bagasse and press mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 10% of the price of bagasse and press mud since the appellant was not maintaining separate accounts for inputs used in the manufacture of bagasse and press mud and other products. AR has thus pressed for dismissal of the appeal. 5. We have carefully considered the rival contentions and perused the record. 6. The demand against the appellant has been confirmed with the aid of Rules 6(3)(i) and (ii) on the basis of 10% of transaction value of bagasse cleared by the manufacturer. Thus, for the purpose of this appeal, we are mainly concerned with Rule 6(1), Rule 6(2) and Rules 6(3)(i) and (ii) of Cenvat Credit Rules, 2004 which are reproduced thus : 6. Obligation of a manufacturer or producer of final products and a provider of taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture of exempted goods and their clearance upto the place of removal; (ii) in or in relation to the manufacture of dutiable final products, excluding exempted goods, and their clearance upto the place of removal; (iii) for the provision of exempted services; and (iv) for the provision of output services excluding exempted services, and shall take CENVAT credit only on inputs under sub-clauses (ii) and (iv) of clause (a) and input services under sub-clauses (ii) and (iv) of clause (b).] (3) Notwithstanding anything contained in sub-rules (1) and (2), the manufacturer of goods or the provider of output service, opting not to maintain separate accounts, shall follow [any one] of the following options, as applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence which formed basis of this conclusion. Thus in our view the findings of the Authority is not supported by evidence and is based on unwarranted assumption. Thus in our view the department has failed to establish that the appellant used Cenvatable inputs for production of baggase. Once it is concluded that the department has failed to establish that the appellant used Cenvatable inputs for manufacture of bagasse, Rule 6(2) and Rules 6(3)(i) (ii) of Cenvat Credit Rules, 2004 are not attracted. As such, we are of the view that the adjudicating authority as well as appellate authority have fallen in error to base their finding on the aforesaid rules. 8. In view of the above, we are unable to sustain the impugned order confirming the du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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