2013 (3) TMI 500

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....Oil (SKO) etc., all of which are chargeable to central excise duty. The crude oil received by the refinery has some sulphur content which is present in the HSD Oil also obtained by refining of Crude oil. Since as per the ISI Standards prescribed for HSD, it should not have more than 0.25% of the sulphur so as to reduce the environmental pollution caused due to the emission of sulphur dioxide from the vehicles, HSD oils obtained from the refining of crude oil is required to be subjected to the de-sulphurisation process for removal of sulphur. For de-sulphurisation, the HSD is reacted in the presence of catalyst with Hydrogen. The Hydrogen reacts with sulphur to form Hydrogen sulphide. Since Hydgrogen Sulphide can not be released as such in t....

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.... amount on the appellant company under Rule 15(2) of Cenvat Credit Rules, 2004 read with Section 11AC of the Central Excise Act. The Commissioner while confirming this demand and imposing penalty on the appellant under Rule 15(2) of the Cenvat Credit Rules, 2004 held that the appellant are guilty of suppressing the relevant facts from the department. Against this order of the Commissioner, this appeal has been filed. 2. Heard both the sides. 3. Shri A.R. Madhav Rao, Advocate, ld. Counsel for the appellant, pleaded that the chemical MDEA is used for dissolving Hydrogen Sulphide gas formed in course of processing of HSD Oil for removal of sulphur, that removal of sulphur is a necessary step in the manufacture of HSD oil, as pe....

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....the provisions of Rule 6(1) of Cenvat Credit Rules, 2004. 5. We have considered the submissions from both the sides and perused the records. The undisputed facts are that in terms of ISI Standards prescribed for HSD Oil, its sulphur content should not be more than 0.25%. Therefore, if the crude oil has higher sulphur content, as a result of which, the HSD oil obtained by refining of crude oil also has sulphur content much higher than that prescribed in the ISI specifications, the same would have to be removed. In course of de-sulphurisation process, the HSD Oil is reacted with hydrogen in presence of catalyst in course of which the sulphur present in the HSD reacts with hydrogen to form Hydrogen sulphide. The MDEA is used for dissol....