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2014 (10) TMI 191 - AT - Central ExciseDenial of CENVAT Credit - Clearance of Bagasse - Held that - Tribunal in the case of M/s.Subramaniya Siva Co-operative Sugar Mills Ltd. Vs CCE Salem vide 2013 (10) TMI 990 - CESTAT CHENNAI granted unconditional stay on the identical issue holding that Bagasse, press-mud are not excisable goods and therefore Rule 6 (3) of the Central Excise Rules would not apply - Madras High Court in the case of CCE Salem Vs Burn Standard Co. Ltd. - 2013 (2) TMI 35 - Madras High Court dismissed the Revenue s appeal for a period prior to amendment of Section 2(d) of Central Excise Act, 1944. We find that the said case is related to denial of cenvat credit on furnace oil used as common input in dutiable and exempted products. In the present case, the Tribunal consistently viewed that Bagasse is not an excisable product and therefore Rule 6(3A) would not apply. - we waive predeposit of duty along with interest and penalty and stay its recovery till disposal of the appeal - Stay granted.
Issues involved:
1. Early hearing of stay application 2. Liability under Rule 6(3) of Cenvat Credit Rules for Bagasse Analysis: 1. The judgment dealt with applications for early hearing of stay application filed by both the Revenue and the appellant. The Tribunal dismissed the early hearing applications as the stay petition was taken up for disposal, rendering the early hearing applications infructuous. A common issue regarding the liability under Rule 6(3) of Cenvat Credit Rules for Bagasse was identified, leading to both applications being considered together for disposal. 2. The applicants were engaged in the manufacture of various products and availing cenvat credit. The issue revolved around Bagasse, a byproduct of sugar cane crushing, which the Revenue claimed should be subject to duty under Rule 6(3) of the Cenvat Credit Rules as an exempted good. However, the Tribunal referred to precedents where it was held that Bagasse is not an excisable product. In one case, unconditional stay was granted on the identical issue, emphasizing that Bagasse is a waste product and not excisable. The Tribunal also highlighted that the amendment in the Finance Act and the Board's Circular would not impact the situation as Bagasse emerges during the sugar cane crushing stage, separate from the inputs used in the production of dutiable final products like sugar and molasses. 3. The Tribunal distinguished a decision of the Hon'ble Madras High Court related to cenvat credit denial on furnace oil, stating that it was not applicable to the present case as Bagasse was consistently viewed as a non-excisable product. Consequently, the Tribunal waived the predeposit of duty, interest, and penalty, staying its recovery until the appeal's final disposal. Both stay applications were allowed based on the discussions and precedents cited. In conclusion, the judgment addressed the early hearing applications, combined them due to a common issue of liability under Rule 6(3) of Cenvat Credit Rules for Bagasse, and ultimately granted the stay applications based on the Tribunal's consistent view that Bagasse is not excisable, aligning with previous precedents and interpretations.
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