2009 (7) TMI 622

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.... were engaged in the manufacture of rectified spirit and had availed inadmissible input credit of duty paid on Molasses, Furnace oil and Yeast. After due process of law, the Commissioner adjudicated the show cause notice issued to them and disallowed Cenvat credit of Rs.2,28,85,316/- (Rupees Two crore twenty-eight lakh eighty five thousand three hundred and sixteen only) under Rule 12 of Cenvat Credit Rules, 2001/2002. As the appellant had already reversed an amount of Rs.1,45,29,161/- (Rupees one crore forty-five lakh twenty-nine thousand one hundred and sixty-one only) on clearance of rectified spirit, the Commissioner appropriated the balance credit of Rs.83,56,155/- (Rupees Eighty-three lakh fifty-six thousand one hundred and fifty-five....

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....ot have collected duty on it's clearance. Relying on the following case-law, it is submitted that when the department had accepted the duty paid by the appellants on the goods, one has to admit that they were the manufacturer of the said goods : (a) Sunpra Energy & Recovery Engg. Pvt. Ltd. v. CCE - 1996 (88) E.L.T. 551. (b) Biotech Synergy Ltd. v. CCE - 2004 (171) E.L.T. 400. (c) Natural Vitamins Ltd. v. CCE - 2005 (179) E.L.T. 326. 3.1 They had manufactured and cleared both exempted rectified spirit and dutiable denatured spirit. They had availed Cenvat credit on the inputs received and reversed the credit relatable to the inputs contained in the exempted rectified spirit when cleared, in accordance with the provisions of Rule ....

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.... VSL had not manufactured denatured spirit. We observe that this finding of the Commissioner is incorrect. It is noted by the Commissioner that VSL was liable to pay duty on denatured spirit as it was cleared from the factory. We are not able to agree with the finding of the Commissioner that the denatured spirit involved had not been manufactured in the factory of the appellant. During the period September, 2001 to 14-5-2004, VSL had cleared only 40,000 Ltrs. of denatured spirit. Unless M/s. VSL intended to clear both exempted and dutiable goods, there was no need for it to have availed credit on common inputs. Moreover, the Revenue did not stand to lose in any way if VSL availed credit as provided in the CCR. In Rochi Ram & Sons case (sup....