TMI Blog2023 (9) TMI 712X X X X Extracts X X X X X X X X Extracts X X X X ..... 207.2000 respectively. They cleared Sugar, Molasses and Denatured Ethyl Alcohol on payment of duty. However, Molasses was also captively consumed within the factory for the production of DNA and Rectified Spirit, which is un-denatured Ethyl Alcohol of concentration of about 95%. In respect of molasses so captively consumed, the appellant was availing exemption under notification No.67/95-CE dt. 16.03.1995 as amended. As per the said notification it exempts from payment of duty on inputs /capital goods used in the manufacture of final products as along as the final product is not exempt from duty or are not chargeable to nil rate of duty. According to department, the Rectified Spirit manufactured using the captively consumed molasses was not excisable goods and does not come within the definition of finished product . Therefore, the exemption availed under notification 67/95 in respect of molasses used for production of Rectified Spirit is incorrect. SCN was issued proposing to demand duty on the quantity of molasses captively used in production of rectified spirit from July 2012 to March 2013. After due process of law, the original authority confirmed the demand, interest and imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... officers must ensure implementation of the amended Tariff Act (including 8-digit classification code in it s new 1st 2nd Schedules) from 28-2-2005. Trade should also be suitably informed immediately and guided in the matter so that the transition from 6-digit to 8-digit classification code is smooth without any difficulty to the trade in day-to-day clearances. 3. Notification No. 3/2005-C.E., dated 24th February 2005 has been issued to preserve the existing duty rates on specified commodities where effective rates were built into the six-digit tariff, but are now subject to different tariff rates in the 8-digit code. This is subject to any subsequent changes. 8.4 In the present case, there is no dispute that prior to 28-2-2005, Rectified Spirit and ENA manufactured by the appellant were covered under sub-heading No. 2204.90, NIL rate of duty. After amendment of Tariff (8 Digit Classification Code), Heading 22.04 would correspond to Heading No. 22.07. In the above Board Circular, it has been clarified that Notification No. 3/2005-C.E., dated 24-2-2005 was issued to preserve the existing duty rate. So, it is clearly evident that the Rectified Spirit existing NIL rate of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Abhay Kumar Srivastav Deputy Secretary to the Government of India Note : This notification intends to take care of the technical changes adopted in the numbering scheme for Central Excise classification through the Central Excise Tariff (Amendment) Act, 2004 (5 of 2005). These amendments do not involve any substantive changes in the existing rules, so the particulars of each rule have not been indicated. Furthermore, during debate in Lok Sabha on the said Central Excise Tariff (Amendment) Bill, 2004, the then Hon ble Minister of Finance in regard to the purpose of introduction of eight digit classification has stated that the purpose of the Bill is very limited. On the custom side, we already have an eight-digit classification. It is, therefore, necessary that on the Excise side also we have the same eight digit classification. What we have found is that eight digit classification helps both trade and revenue department to identify a particular product and heading under which it falls. Immediately, the number of disputes comes down very sharply.... . 31. A perusal of the Note appended below the Notification dated 24-2-2005 as well as the statement made by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon by the learned AR are applicable in the facts and law of the case. 8.10 The learned AR referred Rule 48 of Tamilnadu Distillery Rules, 1985, Govt. of Tamilnadu, to establish that Rectified spirit is fit for human consumption. We find that the adjudicating authority accepted prior to 1-3-2005 Rectified Spirit covers under sub-heading No. 22.04 which is not fit for consumption and we are unable to accept the submission of the learned AR. It is noted that as regards Entry 84, List I, Seventh Schedule to the Constitution and other entries relating to alcohol it was only after the decision of the Hon ble Supreme Court in the case of Synthetics and Chemicals [1990 (1) SCC 109] on 25-10-1989 holding that industrial alcohol was outside the legislative competence of State Legislature, the constitutional position relating to excisability for purposes of Central Excise became clear. Tamilnadu Prohibition and Excise Manual, Govt. of Tamil Nadu stated that levy of Excise Duty and Vend Fee on Industrial Alcohol has been withdrawn by the Government by order No. MS No. 167 Home, Prohibition and Excise (III) Department dated 3rd February 1990 effective 25-10-1989, the date of order of Su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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