2016 (11) TMI 1413 - AT - Central Excise

CENVAT credit - cement used for treatment of waste - The Revenue is of the view that since exclusive use of cement was to treat the effluent and it was not used in connection with the manufacture of final product, the appellant is not entitled to take Cenvat credit on cement so used - Held that - the issue has come up before the Tribunal in assessees own case M/s Hindustan Zinc Ltd Versus Commissioner of Central Excise And Service Tax, Jaipur 2015 (10) TMI 1558 - CESTAT NEW DELHI , where it was held that appellant has used cement for stabilization of hazardous waste jarosite as toxic effluent at secured land fill which is part and parcel of their manufacturing activity - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Entitlement to Cenvat credit on cement used for treating effluent jarosite before disposal.

Analysis:
The appeals were filed against an order passed by the Commissioner (Appeals) regarding the denial of Cenvat credit on cement used for treating toxic effluent jarosite before disposal. The appellants, engaged in manufacturing Zinc, Lead, and Sulphuric Acid, treated the toxic effluent as per pollution control norms before discharging it as secured land fill. The Revenue contended that since the cement was exclusively used for effluent treatment and not in connection with the final product's manufacture, Cenvat credit was not permissible. Show cause notices were issued, resulting in the denial of Cenvat credit, confirmation of duty demand with interest, and imposition of penalties. However, in a previous case, the Tribunal observed that using cement for stabilizing hazardous waste as part of the manufacturing activity allowed for Cenvat credit. Consequently, the impugned order was set aside, and the appeals were allowed, following the earlier precedent.

The Tribunal, after considering the facts and the previous decision in a similar case, concluded that the appellant's use of cement for treating hazardous waste as toxic effluent at a secured land fill was integral to their manufacturing activity. As per the earlier order, the Tribunal held that the appellant correctly availed Cenvat credit and was not required to reverse the same. Therefore, the impugned order was set aside, and the appeals were allowed with consequential relief. The decision was based on the understanding that the cement usage for treating effluent was part and parcel of the manufacturing process, justifying the entitlement to Cenvat credit. Consequently, all the appeals were allowed in favor of the assessee.