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2018 (12) TMI 1649 - AT - Central ExciseCENVAT Credit - Whether the explanations entered in Rule 6(3) w.e.f. 01st March, 2015 would have the effect of the assessee being under a legal obligation to pay duty on the non-excisable goods bagasse and press mud? - HELD THAT - It was observed that inasmuch as according to Supreme Court s decision in the case of Union of India v. DSCL Sugar Ltd. 2015 (10) TMI 566 - SUPREME COURT , bagasse has been held to be an agricultural waste or residue, there could be no manufacturing activity. The press mud has also been held to be a waste and not a manufactured product. As such the amendment made in the provisions of Rule 6 would not have any effect to the facts and circumstances of the present case. Maintainability of appeal - monetary amount involved in the appeal - HELD THAT - It stands clarified by the learned A.R. appearing for the Revenue that the amount of duty involved for the month of March, 2015, which is being contested by the Revenue is less than ₹ 20.00 Lakhs - Revenue s appeal is also required to be dismissed on the basis of Litigation Policy. Appeal dismissed - decided against appellant.
Issues:
Whether the explanations in Rule 6(3) from March 2015 affect the duty obligation on non-excisable goods like bagasse and press mud. Analysis: The case involved the appeal by the Revenue against the dropping of proceedings by the original adjudicating authority regarding the duty payment on the clearance of molasses, press mud, and bagasse by the respondents from May 2010 to March 2015. The Revenue contended that the respondents were obligated to pay duty under Rule 6(3)(i) of the Cenvat Credit Rules, 2004. The original adjudicating authority had relied on the Supreme Court decision in the case of Union of India v. DSCL Sugar Ltd. (2015) where it was held that bagasse is an agricultural waste and press mud is a waste, not a manufactured product. The Revenue challenged this decision before the Commissioner (Appeals) for March 2015 based on the amendment in Rule 6. The appellate authority did not support the Revenue's contentions, leading the Revenue to appeal before the Tribunal. The main issue for determination was whether the amendments in Rule 6(3) from March 2015 would impose a duty obligation on the respondents for non-excisable goods like bagasse and press mud. The Tribunal referred to a previous decision in the case of M/s. Simbhaoli Sugar Ltd. v. Commissioner of Central Excise, Noida, where it was established that bagasse and press mud are considered waste or residue and not manufactured products. Considering the Supreme Court's ruling and the nature of bagasse and press mud, the Tribunal concluded that the amendments in Rule 6 would not impact the duty liability in the present case. Ultimately, the Tribunal found no merit in the Revenue's appeal and rejected it. Additionally, the Revenue's appeal was also dismissed based on the amount of duty involved for March 2015 being less than ?20.00 Lakhs, in accordance with the Litigation Policy. Therefore, the appeal was rejected, and the decision was pronounced in the open court.
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