2010 (9) TMI 792

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....ssed by the Assistant Commissioner, Central Excise and Customs, Ahmednagar (hereinafter referred to as "the respondent"). 2. On the basis of intelligence the officers of DGCEI Regional Unit, Nashik initiated the enquiry against the appellant for availing inadmissible Cenvat credit on Molasses which was used for manufacture of Ethyl Alcohol and Alcoholic Liquor allegedly non-excisable. It was also noticed by DGCEI that on clearance of the said goods, the appellant was reversing lesser amount of Cenvat Credit than the credit actually taken by them on the quantity of molasses used by them and thus allegedly evading the payment of Central Excise duty. 3. Therefore, a show cause notice no. DGCE1/NRU/38/2009/140 dated 4-2-2010 was....

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....ellant filed the present appeal mainly on the grounds that : (i)      'Ethyl Alcohol and other spirits, denatured of any strength' are covered under sub-heading no. 2207 20 00 of schedule to Central Excise Tariff Act, 1985 and therefore excisable goods. (ii)    The denatured Ethyl Alcohol is nothing but Ethanol that has additives to make it poisonous or unpalatable, and thus undrinkable. Denaturing of alcohol does not chemically alter the ethanol molecule. (iii)   The issuance of Notification No. 3/2005, dated 24-2-2005 specifically exempting "all spirits other than denatured ethyl alcohol of any strength" supported their contention that 'ethyl alcohol (other than denatured)' is an ....

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.... simultaneously for decision. I have carefully gone through the appeal files and the documents available on records and the submissions made during the course of personal hearing. From the records, I find that the issue in brief to be decided is whether the ethyl alcohol (other than denatured) is non-excisable as contended by the show cause notice or it is excisable but exempted as emphasized by the appellant. I find that the dispute crept up after introduction of Eight digit tariff w.e.f. 28-2-2005 replacing the earlier Six digit tariff. Prior to 28-2-2005 there were two sub-headings viz. 2204.10 & 2204.90 covering Denatured Ethyl Alcohol of any strength, and Ethyl Alcohol other than denatured respectively. After introduction of Eight digi....