TMI Blog2022 (9) TMI 267X X X X Extracts X X X X X X X X Extracts X X X X ..... e is concerned. To the extent the electricity is sold to outsiders, the respondent has reversed the CENVAT credit. On identical issue, High Court of Rajasthan had in COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX, JAIPUR VERSUS SHREE CEMENT LIMITED [ 2018 (9) TMI 822 - RAJASTHAN HIGH COURT] , allowed CENVAT credit on the inputs used in production of electricity which is supplied free of cost to the assessee s sister unit. The respondent is entitled to CENVAT credit to the extent the inputs are used for production of electricity which is transferred free of cost to its sister unit - Appeal dismissed - decided against Revenue. - EXCISE APPEAL NO. 53531 OF 2018 WITH EXCISE MISCELLANEOUS APPLICATION NO. 50363 OF 2019 - FINAL ORDER NO. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the electricity to the Chattisgarh State Power Distribution Company Limited and had to that extent reversed the Cenvat credit on the inputs and input services. However, the appellant had not reversed Cenvat credit to the extent it had supplied the power to its own sister unit which has a separate central excise registration. 3. Accordingly, a show cause notice dated 29.11.2016 was issued to the appellant seeking to recover an amount of Rs. 1,66,45,239/- under Rule 14 of the Cenvat Credit Rules, 2004 [ CCR ] read with Section 11A of Central Excise Act along with interest under Section 11AA. It was further proposed to impose penalty upon it under Rule 15 of CCR read with Section 11AC (1)(c). 4. The Additional Commissioner has pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturing unit only on the inputs or input services used for goods manufactured by it. It cannot avail the Cenvat credit on the inputs or input services which are used for manufacture of final products by sister unit; (d) Rule 3 of CCR clearly specifies that it is the manufacturer of final products who is allowed to take the Cenvat credit of the duty paid on any inputs/capital goods or input services. 6. Learned Authorized Representative vehemently argued that Cenvat Credit Rules make no distinction between the goods which are sold and goods which are supplied free. If the inputs or input services are used for manufacture of final product by the unit they qualify for Cenvat and not otherwise. If a company has two or three units credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontractual rates in favour of joint ventures, vendors etc., which is sold at a price. 7. Learned Authorized Representative, therefore, submits that the law laid down by the Supreme Court is that the assessee is entitled to Cenvat credit to the extent they are used for generation of electricity which is used within its factory. The order of the Commissioner (Appeals) is contrary to the law laid down by the Supreme Court. 8. Learned Counsel for the respondent submits that the judgment of the Supreme Court in Maruti Suzuki does not apply to this case because it was a case of electricity being sold by the company to joint ventures, vendors etc. whereas in this case they are using the electricity for their own use though in his sister conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of which is included in the value of the final product and goods used for providing free warranty for final products; or (iii) all goods used for generation of electricity or steam or pumping of water for captive use; or (iv) all goods used for providing any [output service, or; (v) all capital goods which have a value upto ten thousand rupees per piece. 12. The case of the appellant Revenue is that since part of the electricity is transferred to sister unit, the inputs used in generating it to that extent is an input for the sister unit as it is relatable to the goods manufactured by it and they are not inputs relatable to the final products of this respondent. Each unit is separately registered and is a separate assessee as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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