TaxTMI 
TaxTMI 
2015 (11) TMI 454
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....pheld. 2. The brief facts of the case are as under:- 2.1 The appellant is engaged in the manufacture of iron and steel products falling under Chapter 72 of the Central Excise Tariff Act, 1985. The appellant avails cenvat credit of duties and taxes paid on inputs, capital goods and input services, used in or in relation to manufacture of the said final products. During the course of manufacture of the aforementioned final product, a by-product namely 'slag' is generated in the process, which the appellant sells to its customers for a consideration. 2.2 During the disputed period, the Central Excise Department initiated proceedings for recovery of the amount equal to 5% of the value of slag removed from factory in terms of Rule 6(3....
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....l have no application for payment of amount, equal to 5% of the value of slag removed from the factory. To substantiate his stand that the appellant is not liable to pay the adjudged amount confirmed by the authorities below, the ld. Advocate has relied on various judgments/decisions rendered by the judicial forums including the judgment of Hon'ble Bombay High Court, in the case of Rallis India Ltd. - Vs. - Union of India, reported in 2009 (233) ELT 301 (Bom.) and decision of this Tribunal in the case of Shree Balaji Ispat - Vs. - CCE, Raipur, reported in 2013 (290) ELT 120 (Tri.-Del.). 4. Per contra, Mrs. Ranjana Jha, the ld. JCDR appearing for the respondent submitted that since the cenvat credit has been taken on the inputs used for....
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....(3) of Rule 6 of the Cenvat Credit Rules, it reveals that the embargo created in the said rule applies only to manufacture of "final products" (i.e. dutiable and exempted). In the present case, the appellant had set-up its factory with the intention to manufacture iron and steel products and slag generates involuntarily during such process. Since, the appellant never intended to manufacture the by-product namely slag and the same emerges as an unavoidable and inevitable waste, emergence of such waste product cannot be termed as "final product" for the appellant, in order to fall within the ambit of Rule 6 of the Cenvat Credit Rules. 8. The Hon'ble Bombay High Court in the case of Rallis India Ltd. (supra) have held that mother liquor a....