2008 (3) TMI 530

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....e Appellant. Smt. R. Bhagya Devi, SDR, for the Respondent. [Order per :  P.G. Chacko, Member (J)]. -  After examining the records and hearing both sides, we note that the appellants are aggrieved by a demand of over Rs. 1.00 crore as also a penalty of Rs. 20.00 lakhs. The substantive demand is for the period May 2006 to February 2007 and in terms of Rule 6(3)(b) of the CENVAT Cr....

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....c acid as a common input, found that the manufacturer had taken CENVAT credit thereon and held that, as they did not maintain separate accounts in respect of hydrochloric acid used in the manufacture of the dutiable and exempted products, they were liable to pay 10% of the sale price of the exempted goods under Rule 6(3)(b) ibid. This was the basis of the relevant Show-cause notice, which ultimate....

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.... be manufactured from animal bones without using hydrochloric acid. In other words, hydrochloric acid might not be a 'common input' for gelatine and the phosphoryls. Thus the case sought to be made by the appellants through their counsel is that the conclusion reached by the larger Bench in Rallies India case, being inconsistent with the finding of fact, could not be a precedent for the present ca....

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....uor is a 'by-product' for gelatine. On the other hand, they say that mother liquor is an intermediary product captively consumed in the manufacture of phosphoryls. It would appear that, according to the appellants, the intermediary product captively consumed in the factory could be recognized as a 'by-product'. We reject this idea at the outset. The case of the appellants is not apparently consist....