TaxTMI 
TaxTMI 
2022 (6) TMI 555
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.... to the atmosphere; for these purposes, the appellants have installed Waste Heat Recovery Boiler; during the process of cooling steam is generated which is sold by the appellants to their sister concern in the adjacent premises who use it for manufacture of steam. Revenue proceeded to deny the Cenvat credit availed on the pollution control equipment i.e. Waste Heat Recovery Boiler and parts and accessories thereof on the grounds that they are utilized in the manufacture of steam which is exempted in terms of Rule 6 (4) of Cenvat Credit Rules, 2004. Revenue also proceeded to demand 10% of the sale value of the steam generated in the process in terms of Rule 6 (3) (b) and Rule 6 (3) (i) of CCR on the ground that some of the inputs were utilis....
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.... (xi) CCE Allahabad Vs Hi-Tech Carbon 2018 (17) G.S.T.L 398 (All.) (xii) SKI Carbon Black (India) Private Ltd. Vs CCE Chennai II 2018 (5) RMI 1416-CESTAT Chennai 4. Learned Authorised Representative Ms. Sridevi Taritla appearing on behalf of the department reiterates the findings in the impugned order. 5. The brief issues that requires our consideration in the present case is as to whether the appellants are eligible to avail Cenvat credit on the pollution control equipment in terms of Cenvat Credit Rules and as to whether the appellants are required to reverse 10% of the Cenvat credit availed by them on other inputs for the reason that the steam generated is an exempted product. 6. Coming to the issue of av....
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....ntral Excise Rule, 2004 cannot be applied. In the instant case steam is generated in the course of manufacture and it cannot be said that the appellants have manufactured steam which is an exempt product. Hon'ble Gujarat High Court in the case of Sterling Gelatin - 2011 (270) 200 (Guj) held that a bye product emerging in the course of manufacture cannot be treated as a manufactured product for the purposes of Rule 6 of Cenvat credit Rules. Hon'ble Court held that: "7. At this juncture, reference may be made to certain statutory provisions. Rule 6 of the Cenvat Credit Rules, 2002 makes provision for "Obligation of manufacturer of dutiable and exempted goods". Sub-rule (1) thereof provides that CENVAT Credit shall not be allowed....
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....quired for manufacturing Gelatin or that by using a smaller amount of Hydrochloric Acid, the production of Mother Liquor could be averted. In the manufacturing process adopted by the assessee, it is not possible to manufacture Gelatin without Mother Liquor coming into existence. Thus, when the entire quantity of input viz. Hydrochloric Acid is used in the manufacture of the final product being Gelatin which is a dutiable product, the mere fact that a by-product emerges during the process would not bring the by-product within the ambit of Rule 6 of the Rules so as to call for maintaining separate accounts in respect of the same. When the entire quantity of input is used in the manufacture of Gelatin, the question of maintaining separate....
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....In other words, in the technology utilized for the manufacture of ethylene and propylene, the emergence of ethane and methane was inevitable. Hence, while it was no doubt correct to say that ethylene and propylene had been used in or in relation to manufacture of ethane and methane, the identical quantity of the same goods had simultaneously been used in the manufacture of ethylene and propylene. The emergence of ethane and methane therefore, by itself, was not a ground to deny the benefit of the exemption notification. 10. In the facts of the present case, it is not as if by using a smaller quantity of input Hydrochloric Acid, the respondent could have averted the emergence of Mother Liquor. In other words, in the technology utili....