TMI Blog2023 (2) TMI 728X X X X Extracts X X X X X X X X Extracts X X X X ..... ENVAT credit availed on the inputs which are used for the manufacture of sugar has to be denied or otherwise has been settled by the apex Court in the case of UNION OF INDIA VERSUS DSCL SUGAR LTD. (SC) [ 2015 (10) TMI 566 - SUPREME COURT ] . Hon ble Apex Court held In the present case it could not be pointed out as to whether any process in respect of Bagasse has been specified either in the Section or in the Chapter notice. In the absence thereof this deeming provision cannot be attracted. Otherwise, it is not in dispute that Bagasse is only an agricultural waste and residue, which itself is not the result of any process. Therefore, it cannot be treated as falling within the definition of Section 2(f) of the Act and the absence of manu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enhas, Superintendent, Authorised Representative for the Revenue. 3.1 Learned counsel for the appellant submits that the issues that arise for consideration are: Whether bagasse/press-mud are excisable products in terms of Section 2(d) of the Central Excise Act, 1944 and whether any manufacturing activity is involved in the manufacture of bagasse/press-mud, as defined under Section 2(f) of the Central Excise Act, 1944. Whether the bagasse/press-mud can be considered as final products in terms of CENVAT Credit Rules, 2004? Whether the appellant was required to pay an amount equal to 5% of the value of the exempted goods i.e. bagasse/press-mud, as pre Rule 6(3) of CENVAT Credit Rules, 2004, as the common inputs/input services w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and molasses falling under Chapter sub-heading 1701 11 90 and 1703 10 00 respectively, of the First Schedule to the Central Excise Tariff Act, 1985. In the process of manufacture of sugar, sugarcane is crushed, its juice is extracted and Bagasse emerges as residue/waste of sugarcane. 4. It is not in dispute that Bagasse is otherwise classified under Chapter sub-heading No. 2303 20 00 of the First Schedule to the Central Excise Tariff Act, 1985 and attracts nil rate of duty. 5. However, show cause notices were issued to the respondents herein stating that Bagasse would be subject to duty under the Central Excise Act, 1944, as other products . These show cause notices were issued to the respondents in terms of the provision con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it introduce the deeming fiction by which certain kind of goods are treated as marketable and thus excisable. 8. However, before the aforesaid fiction is to be applied, it is necessary that the process should fall within the definition of manufacture as contained in Section 2(f) of the Act. The relevant portion of amended Section 2(f) reads as under : Section 2(f) - manufacture includes any process - (i) incidental or ancillary to be completion of a manufactured product; (ii) which is specified in relation to any goods in the section or Chapter notes of [The First Schedule] to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to [manufacture; or] (iii) which in relation to the goods specified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, there cannot be any excise duty. 11. Since it is not a manufacture, obviously Rule 6 of the Cenvat Rules, 2004, shall have no application as rightly held by the High Court. 4.4 This decision of the Hon ble Apex Court has been followed subsequently in following cases:- Kisan Sahakari Chini Mills [2017(355) ELT 156 (T-All)] Vasantdada Shetkari Sahakari Sakhar Karkhana Ltd [2017- TIOL-1613-CESTAT-MUM] Balrampur Chini Mills Ltd. [2019 (368) ELT 276 (ALL)] Nangalamal Sugar Complex [2020 (371) ELT 501 (Del)] Jakraya Sugar Ltd. [2018-TIOL-1845-CESTAT-Mum] 5.1 Following the judgment of the Hon ble Apex Court, the appeal is allowed and the impugned order set aside. (Order pronounced in the open court) - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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