TaxTMI 
TaxTMI 
2006 (10) TMI 363
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....yarn. The appellant is availing Modvat credit as per provisions of Rule 57A of Central Excise Rules, 1944. During the visit of the officers to the appellant's factory it was observed that the appellant was consuming furnace oil for generation of electricity and the electricity so generated was used in the appellant's plant, essential quarter, auxiliary like cooling tower. Show cause notice was issued to the appellant for denial of Modvat credit on the quantity of furnace oil which is used for generation of electricity which was diverted outside the factory by the appellant to their residential colony. The adjudicating authority confirmed the demand and also imposed penalty. Learned Commissioner (Appeals) also upheld the same. Hence, this ap....
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....sion of the Tribunal in the case of SAIL v. CCE, Jamshedpur, as reported at 2001 (137) E.L.T. 572 and Oil India Ltd., New Delhi v. CCE, Calcutta as reported at 1983 (12) E.L.T. 570. 5.  Considered the submissions made at length by both sides and perused the record. The issue involved in this case is regarding denial of Modvat credit to the appellant on furnace oil consumed by him for generation of electricity which is used for electrification of essential quarters situated within the factory premises, it is undisputed that the essential quarters are situated within the factory premises as per approved ground plan submitted by the learned Advocate. It is also undisputed that the appellant is generating electricity for consumption in ....
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....sories of the final products cleared along with the final product, goods used as paint, or as packing material, or as fuel, or for generation of electricity or steam used for manufacture of final products or for any other purpose, within the factory of production." (iv) inputs used for generation of electricity or steam, used for manufacture of final product or for any other purpose within the factory of production; (v) packing materials and materials from which such packing materials are made provided the cost of such packing materials is included in the value of the final product; (vi) accessories of the final product cleared along with such final product, the value of w....
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....ibunal in the case of Ferro Alloys Corporation (supra) has held as under :- 4. We have carefully considered the submissions as well as records of the case and find that in view of the decisions cited supra, it is now a well settled law that fuel oil used for generation of electricity captively would be eligible for Modvat credit in terms of Rule 57A. In view of the decision in the case of Rathi Alloys and Steel Ltd. supra, it is also now clear that the Clause (d) inserted in Rule 57A in 1995 being clarificatory in nature would be applicable to the period prior to this amendment, which is the issue in the present case also. Under these circumstances, we find that there is great merit in this miscellaneous application and an error has....
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....h the surplus electricity generated by the powder plant was sold out to the Madhya Pradesh Electricity Board (MPEB). It was held that restricting the use of surplus electricity within the factory was neither logical nor possible. The Revenue appears to have accepted this view inasmuch as there is no material on record to show that the Tribunal's judgment in HEG Ltd. (supra) has been successfully challenged by the Department. 2. Yet another decision of the Tribunal (Division Bench) which is in favour of the assessee on similar set of facts is in the case of Commissioner of Central Excise, Raipur v. Jindal Steel and Power Ltd. [2003 (158) E.L.T. 178 (Tri.-Del.)], wherein capital goods credit was allowed in respect of capital goods used in ....