TaxTMI 
TaxTMI 
2009 (10) TMI 571
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....No. E/3220/04-Mum. [2007 (220) E.L.T. 471 (Tribunal)] arising out of order-in-Original No. 47/2004/C dated 30-7-2004 passed by the Commissioner of Central Excise and Customs, Nagpur and on 31-1-2007 (No. A/464/2007/EB/C-I) in Appeal No. E/3701/05-Mum. arising out of order-in-Original No. 14/2005/C. dated 8-8-2005 passed by the Commissioner of Central Excise and Customs, Nagpur. The dispute is about CENVAT credit of duty paid for furnace oil meant for generation of electricity. The Appellants contend that as that furnace oil is never received in the factory of production but goes directly to job worker and as Respondent does not have any captive power plant, CENVAT credit is not available on it. 2. The facts are not in dispute. Yarn busin....
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....mposed vide order dated 30-7-2004. In other matter, for the period from1-1-2004-30-9-2004credit of Rs. 1,13,17,607/- was found to be wrongly availed and penalty amount of Rs. 15,00,000/- was also imposed vide order dated8-8-2005. The amounts were to be recovered along with interest. Both these orders of Commissioner of Central Excise and Customs were then assailed in appeals before CESTAT, who set aside the same. Thereafter present Appeals have been filed. 4. The contention of Adv. S.K. Mishra, learned ASGI, is that Respondent No. 1 is not generating electricity and hence, furnace oil is not an input for it. According to him, as Respondent No. 1 does not have any captive power plant, M/s. IRSL who supply electricity to it cannot be treat....
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....nd contends that furnace oil need not be used within factory of production. According to him, purchase of part of business of M/s. IRSL and of furnace oil as fuel by Respondent No. 1, separate storage tanks for said fuel with M/s. IRSL and receipt by Respondent No. 1 of electricity produced from it by said job worker within period of 180 days are the facts not in dispute. He places strong reliance upon judgment of Hon'ble Apex Court reported at (2006) 2 S.C.C. 351 = 2006 (194) E.L.T. 3 (S.C.) - Vikram Cement v. Commissioner of Central Excise, Indore to urge that issue is squarely covered by said judgment. He, therefore, states that no substantial question of law arises and Appeals as filed need to be dismissed. 6. In Vikram Cement v. Com....
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....) read with the Explanation. Thus clause (i) provides for inputs which are manufactured and used within the factory of production. Paints, fuel, packing materials and accessories are also treated as inputs under clauses (ii), (iii), (v) and (iv) without any requirement for user within the factory. Clause (iv) provides for credit on inputs used for generation of electricity or steam used for manufacture of the final products or for any other purposes "within the factory of production". It appears to us on a plain reading of the clause that the phrase "within the factory of production" means only such generation of electricity or steam which is used within the factory would qualify as an intermediate product. The utilization of inputs in the ....
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....ment shows that credit is permissible in respect of intermediate goods received from a job worker on or after1-4-2000. Credit can be allowed only if the intermediate products received by the manufacturer of the said final products are accompanied by any of the documents as specified under Rule 57-AE(1) evidencing the payment of duty on such inputs of capital goods. Rule 57-AB introduced for restoring benefit granted earlier under Rule 57-J is held to be effectively duplicating the substance of Rule 57-J(1) and (2) and dealing with a situation where inputs are received by a job worker for production of intermediate goods which are used in the manufacture of a final product. Following conclusions reached in paragraph 24 are important :- "24. ....