2019 (8) TMI 419

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....acturing process bagasse is generated as waste. The department proposes to consider the said bagasse as exempted goods manufactured by the appellant and thus demand has been made as per Rule 6(3) of Central Excise Rules alleging that the appellant has to pay amount equivalent to the value of the clearances of bagasse made by the appellant. He adverted to Explanation 1 inserted in 2015 under Rule 6 and argued that the said Explanation will not be applicable to bagasse that emerges during the manufacture of sugar. The appellant does not consciously manufacture bagasse and, therefore, the Explanation is not applicable to the bagasse which is generated as a waste during the process of manufacture. He relied upon the decision of the Tribunal in ....

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....se duty. The Hon'ble Apex Court further clarified that since it is not a manufacture, Rule 6 of Cenvat Credit Rules shall have no application. For the better appreciation Rule 6 is reproduced herein below:- "Rule 6(1) The Cenvat credit shall not be allowed on such quantity of inputs used in or in relation to the manufacture of exempted goods or for provisions of exempted services, or input service used in or in relation to the manufacture of exempted goods and their clearance upto the place of removal or for provision of exempted service except in the circumstances mentioned in sub rule (2): Provided that the CENVAT credit on inputs ..................................... 8.1 This rule was amended w.e.f. 01.03.2015 ....