TaxTMI 
TaxTMI 
2019 (10) TMI 1100
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....erred in modifying the Order-in- Original passed by the Adjudicating Authority and directing for re-quantifying the demand of Cenvat Credit to be reversed by the assessee as per Rule 6(3A) of Cenvat Credit Rules, 2004. Whereas as per Appellant they are not liable to reverse any Credit in view of settled legal position and both the authorities below erred in directing the assessee to reverse the same. 2. The issue involved is about the reversal of Cenvat Credit on bagasse under Rue 6 ibid for not maintaining separate accounts. The Appellants are engaged in manufacture of Excisable goods viz. Sugar, Molasses which are cleared on payment of duty. During the course of manufacture of sugar and molasses, by product Babasse emerges which is a wa....
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.... the Appeal. 3. I have heard learned counsel for the Appellant and learned Authorised Representative for the Revenue and perused the records of the case including the case law submitted by the learned counsel during the course of hearing. Learned counsel for the assessee submits that the reversal of Cenvat credit has been demanded under the provisions of Rule 6 of Cenvat Credit Rules, 2004 for bagasse cleared by them. According to learned counsel bagasse is nothing but waste of the finished goods i.e. Sugar and Molasses and therefore Cenvat credit is not required to be reversed. He cited number of decisions in his favour starting from Hon'ble Supreme Court upto this Tribunal, in support of his argument that reversal of Cenvat Credit under....
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.... even though they are non-excisable. He also reiterated the grounds raised in the Appeal filed by Revenue and submits that the learned commissioner erred in modifying the Adjudication order passed by the Assistant Commissioner by directing the re-quantification of the demand of Cenvat Credit to be reversed by the assessee. Although alongwith the Appeal, Revenue also filed three decisions, but in my view none of them is on the issue about Cenvat Credit on waste produced during the production of excisable goods and are not relevant for deciding the issue involved in the instant Appeals. 4. Cenvat Credit Rules, 2004 were amended w.e.f. 1.3.2015 by inserting Explanation 1 and 2 in Rule 6(1), which reads as under:- Explanation 1. - For the ....
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....ibid has wrongly been relied upon by both the authorities below while coming to the conclusion that the assessee is liable to reverse the Cenvat Credit availed by them. As per Rule 6(1) ibid read with Explanation-1, non-excisable goods which are manufactured by the manufacturer in his factory will get covered under Rule 6(1) and those goods which were not manufactured, like bagasse in these appeals, will not be covered under Rule 6 despite being non-excisable goods because bagasse is not being manufactured in the factory but emerged as agricultural waste or residue. Rule 6(1) was amended in order to include the inputs used in relation to the manufacture of exempted goods. As such it can be seen that the same relates to the manufacture and i....