2019 (8) TMI 146 - AT - Central Excise

Appeal dismissed on irregular credit for Ethanol under Chapter 29

The appeal filed by the department regarding the irregularly availed credit on Ethanol was dismissed. The classification of Ethanol under Chapter 29 was ... CENVAT Credit - Ethanol (Ethyl alcohol) - denial of credit on the ground that the product contained alcohol and was not classifiable under Chapter 29 - HELD THAT:- Following the decision in the respondent’s own case [2016 (10) TMI 507 - CESTAT HYDERABAD] , the appeal filed by the department is without merits. On the very same issue, in the case of CCE VERSUS NEULAND LABORATORIES LTD. [2015 (10) TMI 669 - ANDHRA PRADESH HIGH COURT] where Tribunal on fact found that in this case duty levied on the raw material has actually been paid. Once it is found on fact and it is not challenged on the ground of any perversity, the exemption is applicable automatically. Appeal dismissed - decided against Revenue. Issues:1. Allegation of irregularly availed credit on Ethanol2. Classification of Ethanol under Chapter 293. Eligibility of respondents for credit4. Decision in respondent's own case and previous judgments5. Appeal filed by the departmentAnalysis:1. The case involves an allegation that the respondents irregularly availed credit on Ethanol, which was used as an input for manufacturing final products. The excise duty on the ethanol was paid by M/s Andhra Sugars Limited, the supplier. The original authority confirmed the demand for recovery of wrongly availed credit, along with interest and penalty. The Commissioner (Appeals) later set aside this order, leading to the department filing the present appeal.2. The key issue in this case revolves around the classification of Ethanol (Ethyl alcohol) under Chapter 29. It was contended that since the product contained alcohol and was not classifiable under Chapter 29, it was not excisable goods, making the respondents ineligible for credit. The decision in the respondent's own case and previous judgments were cited to support this argument.3. The Ld. AR for the department reiterated the grounds of appeal, emphasizing the need to recover the wrongly availed credit. However, based on the decision in the respondent's own case and the judgment upheld by the Hon'ble Jurisdictional High Court of Andhra Pradesh, the appeal filed by the department was deemed to be without merits.4. It was highlighted that the decision in the respondent's own case, along with the judgment reported in [2016 (339) ELT 263 (Tri.-Hyd.)] and Final Order No. 22100-22102/2015, supported the position that the appeal lacked merit. Additionally, the Tribunal's decision upheld by the High Court in Commissioner vs. Neuland Laboratories Limited [2015(319) ELT A 140 (A.P)] on a similar issue further strengthened the dismissal of the appeal.5. In conclusion, the appeal filed by the department was dismissed based on the precedents set by the decision in the respondent's own case and the supportive judgments. The order was dictated and pronounced in open court, bringing closure to the dispute.