2016 (6) TMI 402

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....liable to Central Excise duty. They were availing Cenvat credit on inputs and on input services. They are having a power generation plant in their unit at Chanderia. They were availing Cenvat credit on GTA services for inward transportation of coal/LDO for the power plant. A dispute arose regarding their entitlement for full amount these credits, as the electricity generated in the said plant was cleared partly to their other two smelting units and also partly sold to utility companies. The Revenue proceed to demand and recover input service credit of Rs. 36,06,165/-. The proceedings initiated by issuing 5 different show cause notices have concluded in the confirmation of all the demands alongwith imposition of equal amounts of penalty. On ....

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.... could be distributed to their other two units by following the prescribed procedure for input service distribution. In such case not following the procedure of ISD by itself cannot be the reason to deny of credits as held by the Tribunal in Doshion Ltd. vs. CCE, Ahmedabad reported in 2013 (288) E.L.T. 291 (Tri. - Ahmd.) as affirmed by the Hon'ble Gujarat High Court in CCE vs. Dashion Ltd. reported in 2016 (41) S.T.R. 884 (Guj.). Further, reliance was placed on the Tribunal decision in the appellant's own case vide final order No. A/939/2012 - SM (BR) dated 10/07/2012 wherein their appeal on the same ground was allowed. 3. The learned AR reiterated the findings of the lower Authorities and submitted that the definition for input service ....

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....nit could not have been questioned and the credit could have been passed on to the unit which is actually using the electricity or retained fully by the appellant himself without proportionate distribution. Such being the factual position, I find that the impugned orders are not sustainable. Further, the reliance placed in the impugned order on the ratio of Honble Supreme Court in Maruti Suzuki Ltd. vs. CCE, Delhi - III (supra) is not appropriate. In fact the appellate Authority records that the facts are different in both the cases but still goes ahead and applies the ratio. As mentioned earlier in this order, the Honble Supreme Court was dealing the sale of electricity to outside parties and not to clearance of electricity to another ma....