2019 (4) TMI 1684

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..... per Notification No. 03/2005-CE dated 24.02.2005, as amended. It is also an admitted fact that they are generating non-dutiable product namely, electricity in their co-generation power plant, used captively in their factory and the excess power is sold to Tamil Nadu Electricity Board (TNEB). Molasses is being purchased by the assessee-appellant on payment of duty from other units and accordingly, the assessee avails CENVAT Credit of the duty paid and this is used as the common input in the manufacture of both dutiable and exempted final products. 2.1 Entertaining a doubt, inter alia, that the assessee are not maintaining separate accounts for the above reasons as required under Rule 6(2) of the CENVAT Credit Rules, 2004, a Show Cause Not .....

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..... d, thereby contesting the same on both grounds i.e., (i) Invoking the extended period of limitation; and (ii) The inclusion of attributable credit in respect of electricity to the exempted turnover. 2.4 The first appellate authority however vide impugned Order-in-Appeal dated 16.03.2012 being not convinced with the plea of the assessee, rejected the appellant's case, thereby upholding the demand per Order-in-Original. Aggrieved, the assessee has come in appeal. 3. Today when the matter was taken up for hearing, Ld. Advocate Shri. H.Y. Raju appeared on behalf of the appellant and Ld. AC (AR) Shri. B. Balamurugan appeared on behalf of the Revenue. We have heard the rival contentions, gone through the case records and the decisions r .....

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..... , which we hereby do. 6. On the issue of invoking the extended period of limitation, however, the assessee has placed on record the notices issued by the Revenue proposing periodical audits, which fact justifies that the Revenue was in the know of the appellant's activities right from 2005. Moreover, the issue is one of factual, which was explained by the assessee to be because of bona fide belief entertained by it and the fact that the retrospective amendment to Rule 6 brought in vide the Finance Act, 2010 made the reversal of CENVAT Credit attributable to the manufacturing of exempted goods or providing exempted service mandatory. For the above reasons, we have to hold that there was no justification for the Revenue to invoke the larger .....

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