2005 (2) TMI 369

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....mber (J) (Oral)]. - The respondents were engaged in the manufacture of Sugar from Sugarcane, wherein Molasses was a by-product. They were also manufacturing 'Denatured Spirit' (SH No. 2204.10 of the CETA Schedule), 'Rectified Spirit' (SH No. 2204.90) and 'Extra Neutral Alcohol' (SH No. 2204.90) from Molasses in their Distillery Division. Out of these three products, 'Denatured Spirit' was dutiable....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... of the said exempted products in their Modvat/Cenvat account, just as they ordinarily did during other periods when they manufactured both dutiable and exempted products. During the aforesaid periods, they had also taken Modvat/Cenvat credit on Molasses. The Department issued show cause notices to the party proposing to disallow such the Modvat/Cenvat credit taken on Molasses used in the manufact....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....pellants to avail Modvat/Cenvat credit on Molasses and to pay an amount equal to 8% of the price of the exempted products in terms of Rule 57CC(1)/57AD. The benefit of Rule 57CC(1)/Rule 57AD was not liable to be denied merely on account of the fact that only the exempted products were manufactured during some period. Ld. Counsel also pointed out that, while directing them to reverse the entire cre....