TaxTMI 
TaxTMI 
2017 (3) TMI 652
X X X X Extracts X X X X
X X X X Extracts X X X X
....ure of finished products. A Stow Cause Notice was issued to the appellants alleging that they have availed irregular CENVAT Credit of service tax paid on input services which were used commonly in manufacture of both dutiable and exempted goods without maintaining separate accounts. 2. The Show Cause Notice covered the period 2007-2008 to 2011-2012 and proposed to recover an amount of Rs. 18,32,726/- being the proportionate credit availed on common input services used for manufacture of exempted goods like rectified spirit and excisable good namely electricity. After due process of law, the original authority confirmed the demand along with interest and imposed equal amount penalty. In appeal, the Commissioner (Appeals) upheld the same. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... has also argued on the issue of limitation. He submitted that the Show Cause Notice for the period of 2007-2008 to 2011-2012 has been issued on 04.05.2012 invoking the extended period, alleging that appellant is guilty of suppression of facts. He pointed out from the grounds of appeal that the department was always aware of the credit availed and the details of such credit availed by the appellant. The department had issued periodical Show Cause Notices (6 numbers) for the period March, 2007 to April, 2010 alleging irregular availment of CENVAT Credit on capital goods used in the captive power plam to generate electricity. After adjudication, these Show Cause Notices were dropped vide an Order-in-Original number 34/2012 dated 29.03.2012....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s provided in the amendment brought forth by eighth schedule of the Finance Bill 2010-2011. For the period from to 1.4.2008 to 31.3.2012 the manufacturer who does not maintain separate accounts has to opt for either of the conditions laid down in Rule 6(3) of CENVAT Credit Rules, 2004. The appellants have not exercised option to pay proportionate credit. Therefore the demand raised is correct. It is also submitted by him that electricity being an excisable good with nil rate of duty, would fall under exempted final product and that appellants are liable to reverse the credit in respect of electricity also. 6. With regard to the issue of limitation the Learned AR submitted that the appellant on their own did not mention the factum of avai....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gh appellant paid excise duty on molasses has not availed credit on them. The duty paid on molasses for the disputed period would come to Rs. 3,21,12,782/-. In Solaris Chemtech Ltd 2007 (214) ELT 481 the Hon'ble Apex Court held that electricity is a not an excisable item and that is admissible on inputs used for generation of electricity which is capitively consumed. 8. Therefore the demand in respect of electricity cannot be sustained. However if the electricity is sold outside, the appellants are not eligible for availing credit in respect of the electricity sold outside. Thus though appellants may be eligible for the credit of input services used for manufacture of electricity consumed captively they are not eligible for credit of....