TMI Blog2017 (4) TMI 786X X X X Extracts X X X X X X X X Extracts X X X X ..... 6(2) of the Cenvat Credit Rules, 2001, 2002 & 2004 are not applicable - appeal dismissed - decided against Revenue. - E/2899/2007-EX[SM] - FINAL ORDER NO.70285/2017 - Dated:- 14-2-2017 - Mr. Anil Choudhary, Member (Judicial) Shri D. K. Deb, Assistant Commissioner (AR), for Appellant None for Respondent ORDER Per: Anil Choudhary The Revenue is in appeal against order of the Commissioner (Appeals) wherein under the facts that the respondent-assessee was engaged in the manufacture of Carbon Black and using input furnace oil for generation of steam to run their machinery and to generate electricity and some part of the surplus steam is sold out to the adjoining industrial units, it has been held that the respondent-as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k and not Steam. The generation of steam is only for the purpose of running the turbine, and in such circumstances the provisions of Rule 6(2) of Cenvat Credit Rules 2001, 2002 2004, do not apply. Further reliance was placed on the ruling of this Tribunal in the case of Kothari Sugars Chemicals Ltd. Versus Commissioner of Central Excise, reported at 2005 (67) RLT 414 wherein it was held that in such situation, the assessee would be required to reverse credit corresponding to the credit taken on inputs used for the generation of steam. Further contended that inputs for the purpose of Rule 6, do not include furnace oil, used as fuel. This exclusion of fuel under Rule 6 existed till 16th of May, 2005. It was further urged that the extended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in case of fuel. Since there is no finding that furnace oil was not used as fuel, the objection to the eligibility to credit and subsequent recovery at 8%/10% cannot be upheld in this case. In the erstwhile Rule 57CC also, an exception was created for the fuel used as an input, meaning thereby that when a manufacturer avails Modvat credit on an input used as fuel and manufactures a final product or products, a part of which is cleared without payment of duty, he will not be required to pay 8% of the price of such products cleared without payment of duty. A comprehensive and harmonious reading of the above provisions leads me to conclude that the Rules have created an exception in respect of inputs used as fuel and neither any Modvat credi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mon input for both the final products namely Carbon Black Steam. Accordingly the respondent-assessee was liable to reverse the prescribed percentage on removal of the final product steam without payment of duty. 6. The respondent-assessee is absent on call, in spite of notice, accordingly it is decided to dispose of the appeal ex-parte as the facts lie in a very narrow compass. 7. Having considered the rival contentions and on perusal of the records, I find that the whole Show Cause Notice is misconceived as it is not the case of Revenue that furnace oil is not fuel, used in the factory of the respondent-assessee. I further find that steam is not a final product of the respondent-assessee. Fuel has been used for manufacture of C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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