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2013 (9) TMI 823 - HC - Central ExciseCENVAT credit - Duty on waste product - Whether after insertion of explanation in Section 2(d) of the Central Excise Act, 1944 with effect from 10/05/2008 the Bagasse is an exempted excisable product and whether on its sale value the party is liable to pay an amount at prescribed rate in terms of Rule 6(3) of Cenvat Credit Rules, 2004? - Held that - controversy on hand is squarely covered in Balrampur Chini Mills Ltd. versus Union of India 2013 (1) TMI 525 - ALLAHABAD HIGH COURT in favour of manufacturer of Sugar. - Decided against Revenue.
Issues:
Appeal against order passed by Custom Excise & Service Tax Appellate Tribunal regarding excise duty on Bagasse. Analysis: The case involves an appeal filed against an order passed by the Custom Excise & Service Tax Appellate Tribunal, New Delhi, under Section 35-G of the Central Excise Act, 1944 by the Revenue. The respondent, a manufacturer of sugar and molasses, argued that Bagasse, a waste product from sugarcane crushing, is not subject to excise duty, hence Rule 6(3) of the CENVAT Credit Rules, 2004 does not apply. The Tribunal accepted the respondent's contention. The questions of law raised in the memo of appeal relate to the exempt status of Bagasse post an explanation in Section 2(d) of the Central Excise Act, 1944. The appellant sought resolution from the High Court on these legal questions. The respondent's counsel cited a Division Bench decision of the Lucknow Bench, which favored a sugar manufacturer in a similar case. The decision highlighted that Bagasse, as an agricultural waste of sugarcane, is not subject to duty even with the explanation in the Central Excise Act. The Circulars issued by the Chief Commissioner and the Central Board of Excise and Customs were deemed liable to be quashed based on the Apex Court's judgment. The appellant's counsel acknowledged that the matter was under the consideration of the Apex Court, but no notice of the special appeal had been issued to the manufacturer. Considering the arguments and precedents presented, the High Court found no merit in the appeal and dismissed it summarily. The judgment reaffirmed the non-liability of excise duty on Bagasse, in line with the Division Bench decision and the interpretation of Bagasse as agricultural waste exempt from duty under the Central Excise Act.
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