2020 (4) TMI 443

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....he appellant undertakes such manufacturing activities in its factory located at Khalapur, Raigad. The appellant avails Cenvat Credit of Central Excise duty paid on the inputs and capital goods and service tax on the input services. The appellant also operates a Windmill Plants installed at Dhule Site, which is almost 600 km away from the factory of manufacture of the dutiable final product. The electricity generated from the Windmill Plants are transmitted to the Maharashtra State Electricity Board (MSEB) at Dhule. The appellant did not avail any Cenvat Credit on the inputs and input services used exclusively within the Windmills Site. However, during the disputed period April 2010 to March 2016, the appellant had availed common input servi....

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....lectricity can neither be considered as excisable goods nor exempted goods as defined under Rule 2(d) ibid, the embargo created in whole of Rule 6 ibid shall not be applicable for maintenance of separate records or for payment of amount on the exempted goods as stipulated therein. He also submits that the appellant had calculated the quantum of common input service used for manufacture of the excisable goods and for generation of electricity and accordingly, reversed proportionate Cenvat Credit in respect of the input services used in the Windmill Plants. Ld. Advocate further submits that even after the amendment of Rule 6 ibid w.e.f. 01.03.2015, the case of the appellant will not fall within the purview of Rule 6 ibid, as per the Explanati....

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....hereon, and includes goods which are chargeable to "Nil" rate of duty. On perusal of the description of goods mentioned in Chapter 27 in the CETA, 1985, if reveals that though electrical energy has been assigned with the Chapter sub-heading therein, but there is no corresponding rate of duty to such goods mentioned in the Tariff Act. Thus, electrical energy cannot be considered "Nil" rated goods. Further, the Central Government in exercising of the powers conferred under Section 5A of the Central Excise Act, 1944 has not specifically issued any notification, in exempting electrical energy from payment of Central Excise duty. Hence, electrical energy in my considered view cannot be categorized as exempted goods in terms Section 2(d) of the A....

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....of Tribunal was appealed against before the Hon'ble Supreme Court, which was dismissed by the Hon'ble Court, as reported in 2015 (324) ELT A80(SC) (supra). Since, the issue arising out of the present dispute with regard to consideration of the fact, whether electricity can be considered as "Nil" rated goods or exempted goods is no more res integara, I am of the considered opinion that the impugned order passed cannot be sustained for judicial scrutiny. Further, Rule 6 ibid was amended w.e.f. 01.03.2015, which was to the effected that Explanation-1 was inserted vide Notification No. 6/2015-CE (NT) dated 01.03.2015. The said Explanation reads as "for the purpose of this rule, exempted goods or final products as defined in clauses (d) & (h) of....