2011 (4) TMI 437

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.... to Feb. 2003, the said inputs were obtained without payment of Central Excise Duty/CVD under Notification No.03/2001 dated 1.3.2001 and 06/2002 dated 1.3.2002. These Notifications prescribe Nil rate of duty in respect of petroleum oils intended for use as fuel for generation of electrical energy, by electricity undertakings. On the ground that TPCL was not eligible for exemption in respect of that portion of LSHS/LSWR which is used for generating electricity which was consumed by the company itself, proceedings were initiated and impugned order has been passed confirming duty demand of Rs. 12,88,30,000/- with interest and penalty of equal amount.   2. The ld. counsel for the appellant made very detailed submissions but we find that....

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....mine could run only on power supply form their own power plant. Such use of electricity by NLC in their own plant and mine was not involuntary. Hence on strict interpretation required of any Exemption Notification the benefit of the subject Notifications is not admissible to that quantity of LSHS which was used as fuel for generation of electricity which was not sold but used in the plant and the mine. The issue is, accordingly, held against the appellants. We think, we can claim support from the High Court s judgment in Fertilizer Corporation of India (supra). In that case, a certain quantity of ammonia which emerged in the course of manufacture of urea was sold as such in the open market. Obviously, this quantity of ammonia was not allowe....

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....f NLC. As regards larger period of limitation invoked for demanding duty, we find that the Tribunal in the case of NLC had taken a view that larger period is not invocable. Even though, it was vehemently argued by the ld.Jt.CDR that TPCL had not intimated initially that they could not indicate the exact quantity in respect of electricity consumed in their auxiliary unit and further they had not intimated the department about the use of generated electricity within the auxiliary unit etc, suppression is rightly invocable. We find that in this case, it is a question of interpretation of Notifications and whether the term intended for use can cover the quantity of LSHS/LSWR consumed in the generation of electricity for internal use is subject ....