TaxTMI 
TaxTMI 
2019 (4) TMI 2119
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....inished products. They are also availing Cenvat credit of duty paid on inputs/raw materials, capital goods and input services and utilizing such Cenvat credit towards payment of duty on their final products. In the present case the appellant is in appeal before us against the confirmation of demand in dispute in terms of Rule 6(3) Cenvat Credit Rules, 2004 by which before the department has sought to recover. The disputed amount under Rule 6(3) of the Cenvat Credit Rules, 2004 is on account of on the sale of electricity which was generated from the waste heat produced during the manufacture of sponge iron. 2. Briefly stated facts are that the appellant had generated electricity from waste heat generated(flue gases) in DRI plant (Sponge iro....
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.... are maintained in electronic form for the period upto assent to Finance Act, 2015 (i.e. 13th May, 2015). 3. In the appeal memorandum as well during the course of hearing, the learned Counsel appearing on behalf of the appellants has vehemently agitated the confirmation on the ground that the waste heat coming out of the Sponge unit plant is not a final product, but is waste and refuse and such waste heat is unintended outcome of melting process. Since the waste heat is not a final product, its use in generation of electricity is not liable for Reversal of any Cenvat Credit and there is no application of rule 6 in the present case. That during the process of manufacturing activity, waste heat is released by the DRI Plant (Sponge Iron kilns....
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....section is to provide cooling, the drum flues gases which in turn increase the boiler feed water temperature. The steam will be connected to the Steam Turbine for generation of the power as per the Turbine capacity." Explaining the above process of generation of electricity from waste Heat Recovery Plant, he reiterated that no input or input services are required/used in relation to generation of electricity at waste Heat recovery based power plant and since the waste heat is not a final product, its use in generation of electricity is not liable for Reversal of any Cenvat Credit and there is no application of rule 6(3) in the present case. He relied upon the Final Order No. 52737-52739/2018 dated 12.07.2018 of the Tribunal in the case of....
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....e intended or unintended, but what results in the course of a manufacturing process is a "final product" falling within the meaning of the said provisions, the provisions will apply in full with the intended consequences. Revenue also argued that Rule 57 D uses the words "waste and refuse" along with "by-products". The words by¬product will necessarily have to take its colour and meaning from the accompanying words "waste and refuse". By-product cannot in any event mean final products. This only means that modvat credit cannot be denied on the ground that in the course of manufacture of excisable goods, by-products also arise. The Hon'ble Supreme Court held as follows: - 25. These arguments may seem to be attractive. However, hav....
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....can be easily discerned from a combined reading of the aforesaid provisions that the terms used are 'inputs', 'final products', 'by-product', 'waste products', etc. We are of the opinion that these terms have been used taking into account commercial reality in trade. In that context when we scan through Rule 57CC, reference to final product being manufactured with the same common inputs becomes understandable. This Rule did not talk about emergence of final product and a by-product and still said that Rule 57CC will apply. The appellant seeks to apply Rule 57CC when Rule 57D does not talk about application of Rule 57CC to final product and by-product when the by-product emerged as a technological necessity. Accepting the argument of the app....
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....e, charge of willful suppression does not sustain and the extended period cannot be invoked. He further stated that the reliance placed by the Commissioner (Appeals) in the cases of Maruti Suzuki Ltd, NTPC ltd. And Jai Balaji Ltd. Was misplaced as all these cases were distinguishable and are not relevant to the issue at hand. He argued that the issue in the case of Maruti Suzuki (supra) was relating to input credit on fuel used in manufacture of electricity. In case of NTPC Sail Power Co Pvt Ltd, the issue was whether electricity is goods or services? In case of Jai Balaji Industries Limited, the issue was whether where credit on inputs used in electricity has been reversed by the appellant suo-moto, the provisions of rule 6(3) can be invok....