AI Drafter 
TaxTMI 
TaxTMI 
2018 (7) TMI 770
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.... steam is wheeled to their Unit-II, situated on the same plot. The appellant at their Unit No-I availed CENVAT Credit of Rs. 43,15,655/- on the furnace Oil, used in the generation of steam during the period from June 2008 to Nov 2008. Alleging that the appellant are not eligible to the credit on the quantity of furnace Oil used in the generation of steam, and transferred to their Unit II, demand notice was issued for recovery of the said amount with interest and penalty. On adjudication the demand was confirmed with interest and penalty. Aggrieved by the said order they filed appeal before Ld. Commissioner (Appeals), who in turn, rejected their appeal. Hence, the present appeal. 3. Ld. Advocate Shri P.M. Dave for the appellant submits th....
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....ly. He summits that even today the decision of the Hon'ble Karnataka High Court in Biocon Ltd.'s case wherein cenvat credit availed on furnace oil used for generation of steam, a part of which transferred to other unit, situated in the same plot is held to be admissible. Thus, the issue is a pure question of interpretation of law. Further, he has submitted that both the units of the appellants are 100% EOUs and required to follow rigorous procedure as applicable to an 100% EOU. The appellants are filling ER-2 returns every month and all the particulars are reflected in the said returns. It is his contention that, therefore, invocation of the extended period of limitation is unsustainable. In support, the Ld. Advocate referred the judgment o....
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....s admissible to credit at unit-I or otherwise. 7. The crux of the argument advanced by the Ld. Advocate for the appellant is that since both the units are situated in the same plot, hence be considered to be situated within the same factory premises, therefore, steam transferred from unit-I to unit-II be considered as 'used within the factory of production', accordingly, credit on the furnace oil used for generation of steam, at Unit-I be admissible to credit irrespective of whether the entire quantity of steam generated is consumed in unit-I or a part of it transferred to unit-II. The Revenue heavily relied upon the judgment of the Hon'ble Gujarat High Court in Sintex Industries Ltd.'s case (supra). In the said case the Hon'ble Gujarat ....
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....on;" Mr. Narasimhan, contends that the Plastic Division of the assessee should be treated to be a factory of the assessee and thus, the decision of the Supreme Court in the above case goes in favour of his client. 12. We are, however, not impressed by the above submission of Mr. Narasimhan for the simple reason that the appellant itself has registered the Plastic Division factory separately under Rule 9 of the Central Excise Rules, 2002/Rule 174 of the Rules of 1944. 12.1 Rule 174 (present Rule 9) read with Rule 175(2) mandates that if the same person wants to have licence for carrying on business in more than one capacity, he is required to file separate applications. Rule 175(3) [present Para 2 of the Notification No. 35/2001-C.E....
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....n one unit and transferred to another unit, situated in the same plot is eligible to credit. The Hon'ble Karnataka High court observed as follows: "5. The question of law that arises for our consideration in this appeal is : When the assessee who manufacture the steam, use the same in the factory of manufacturing and also utilized the steam in its another unit which is situated in the same compound, is he entitled to CENVAT Credit proportionately to the extent which was used in the other unit? ............................................................................................................ 15. From the aforesaid decision, it is clear that the definition of 'input' brings within its fold the inputs used for generation ....
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....ated within the said factory premises. The said steam is utilized by the assessee in manufacturing excisable goods in both the units which are situated within the same compound, which falls within the definition of the word "factory" and therefore, the assessee is entitled to CENVAT credit in respect of entire volume of steam used in the manufacture of excisable goods by both the units. That is precisely what the appellate authorities have held and granted relief to the assessee. 8. Thus, there are conflicting views on the subject on the admissibility of CENVAT Credit availed on furnace oil used in generation of steam in one Unit, when a portion of it transferred to another unit situated in the same plot. However, in view of the judgment....