cenvat credit

[harpreet arora]

i want to know whether baggase can be treated as excisable product. The  issue is that in case of suagar factories, they are manufacturing sugars from sugarcane. Two situations rae there

i. the bagasse generated as bye product they are seling outside the factory.

ii. bagasse so generated are being used within factory thermal plant and steam is generated steam  so generated  iss used in the production of electricity which is partly captively consumed within factory in sugar production activity and remaining part is used in workers quarters of the factory employee and if remains the part is sold to the KPTCL for the public usage. Whether they are required to reverse the cenvat credit on that prt of electricity which is sold outside under Rule 6(3) of CCR 2004.  I also want to know that they are doing a very good work of generating power from waste like baggase for the publics use so should we not take leanient view for this and not demand the reversal of cenvat credi. since we are spending so much money to promote nonconventional source of energy and these sugar factory people are also doing the little bit same although for their own purpose. 

AI Summary

Is Bagasse Excisable? Rule 6(3) CCR 2004 and CENVAT Credit Concerns for Sugar Factories Explored A query was raised about whether bagasse, a byproduct of sugar manufacturing, is considered an excisable product, especially when sold or used to generate electricity. The concern involves whether sugar factories need to reverse CENVAT credit under Rule 6(3) of the CCR 2004 for electricity sold outside. The query also suggests leniency due to the environmental benefits of generating power from waste. A response noted that following an amendment to the Central Excise Act, 1944, anything sold is liable for excise duty, but further details on bagasse are needed for a comprehensive assessment.