2016 (6) TMI 1461 - HC - Central Excise

Dismissal of Appeal on Modvat Credit for Capital Goods Sold Outside Factory

The High Court of Madras dismissed the appeal against the Final Order No.1494 of 2005 passed by the Customs, Excise, and Service Tax Appellate Tribunal. ... Seeking withdrawal of appeal - MODVAT Credit - capital goods - part of electricity manufactured using such capital goods is not used in the factory but sold outside - second proviso to Rule 57 R (2) of Central Excise Rules, 1944 ignored - HELD THAT:- While dismissing the Civil Miscellaneous Appeal No.2671 of 2007, as withdrawn, substantial question of law raised is left open. The High Court of Madras dismissed the appeal against the Final Order No.1494 of 2005 passed by the Customs, Excise, and Service Tax Appellate Tribunal. The appeal questioned whether Modvat Credit on capital goods can be allowed when part of the electricity produced using such goods is sold outside the factory. The appellant department withdrew the appeal based on instructions in a circular, and the court dismissed it without costs, leaving the substantial question of law open.