2017 (3) TMI 352

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.... are that the M/s Bajaj Hindustan Ltd., Rudhauli, Basti (Earlier Bajaj Hindustan Sugar & Industries Ltd.) (hereinafter referred to as 'the appellant' having Central Excise Registration Certificate No. AAACB4351JM013 (Earlier AABCT0694HXM006) are a composite sugar unit having distillery also. In sugar unit they are engaged in manufacture of V.P. Sugar & Molasses falling under chapter Sub Heading No. 17011490, 17031000 respectively as also waste products - Press mud and Bagasse both falling under chapter Heading No. 2301.00 of the 1^st Schedule to the Central Tariff Act, 1985 attracting nil rate of duty. 2.2 The appellant also manufacture Rectified Spirit (RS), Extra Neutral Alcohol (ENA), Power Alcohol and absolute Alcohol (non-excisable ....

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....ng Cenvat Credit of Central Excise duty that has been paid on Molasses and has been utilizing the same for the payment of excise duty on their final products. The benefit of said notification (67/1995) can be availed only when the final product is excisable. 2.6 The manufacturer is not entitled to Cenvat Credit on Molasses, other inputs, input services and capital goods which has been used in the manufacture of non-excisable goods i.e. Rectified Spirit which invariably comes first into existence in the distillery section thereafter other products as ENA, Absolute Alcohol, SDS/ODS, DDA comes. Since RS is not specified in the first schedule to the Central Excise Tariff Act, 1985, it is non-excisable, hence the Cenvat Credit chain is snappe....

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..... Singh has admitted that during the period from August, 2007 to July, 2012, they have availed Cenvat Credit amounting to Rs. 37,59,19,941/- on 4866309.22 Qtls of duty paid Molasses received from their own unit as well as purchased from outside, Rs. 1,75,69,474/- on inputs other than Molasses, Rs. 3,24,89,674/- on capital goods and Rs. 2,99,80,943/- on various input services. The aforesaid Molasses, inputs other than Molasses, capital goods and input services have been used in their distillery division. 2.8 The Revenue noticed that the appellant during the period from August, 2007 to July, 2012, had availed irregular Cenvat Credit of Rs. 37,59,19,941/- on the Molasses in dispute, used in the distillery section for manufacture of Rectifie....

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....entral Excise authorities to think that pre-denatured ethyl alcohol does not find placed in Central Excise Tariff. We find that the show cause notice contends that rectified spirit is manufactured in between the process to manufacture denatured spirit and rectified spirit does not find place in Central Excise Tariff with effect from 01.03.2005 and therefore CENVAT credit is not admissible as inputs & input services and capital goods going into manufacture of rectified spirit and then going into manufacture of denatured spirit. Before 01.03.2005, department accepted that rectified spirit is covered under chapter sub heading no.2204.90. As stated above, 2204.90 covers ethyl alcohol (except one for human consumption and which are undenatured. ....