TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Tribunal permits amalgamation of Sugar & Distillery Divisions, emphasizes fair credit transfer & common registration.</h1> <h3>KM SUGAR MILLS LTD. Versus COMMISSIONER OF CENTRAL EXCISE, ALLAHABAD</h3> The Tribunal allowed the appeal, overturning the Commissioner's decision to reject the request for amalgamation of Sugar Division and Distillery Division, ... CENVAT credit - Amalgamation/merger of units Issues Involved: The issues involved in the judgment are the denial of the request for amalgamation of Sugar Division and Distillery Division, rejection of transferring credit from Distillery Division to Sugar Division, and refusal for a common Central Excise registration for both divisions.Amalgamation Request Rejection:The appellants, a Public Limited Company with two plants manufacturing various products, applied for amalgamation of their Sugar Division and Distillery Division. The Commissioner rejected this request citing that the accumulated Modvat credit of molasses cannot be utilized for duty debit on sugar clearances as molasses is not directly or indirectly used in sugar manufacturing. Additionally, the Commissioner observed that both divisions are distinct units with separate facilities and accounts, hence, the request for a common registration certificate or merger was denied. The rejection was based on Rule 57AA(d) and Rule 174(3) of the Central Excise Rules, 1944.Transfer of Credit Denial:The Commissioner denied the request for transferring credit from the Distillery Division to the Sugar Division, stating that molasses, for which credit was sought to be transferred, is not used as an input in sugar manufacturing. The Commissioner's interpretation was challenged as flawed by the appellants, citing Rule 57AF(1) allowing credit transfer subject to specified conditions and Rule 57AB(1B) permitting credit utilization for payment of excise duty on any final product. The Tribunal found the denial of credit transfer unjustified as it was not supported by the relevant provisions of the Rules and allowed the appeal by setting aside the Commissioner's order.Common Registration Certificate Refusal:The Commissioner also refused the request for a common Central Excise registration for both divisions based on the physical separation of the plants, separate facilities, and distinct accounting practices. However, the Tribunal disagreed with this reasoning, emphasizing that if the divisions meet the conditions for merger or amalgamation, they should be granted a common license. The Tribunal held that the denial of a common registration certificate or credit transfer was unfounded in light of the applicable rules and allowed the appeal, overturning the Commissioner's decision.
TaxTMI 
TaxTMI 
