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2018 (11) TMI 1204 - AT - Central ExciseCENVAT Credit - by-products/waste materials arising in the course of manufacture - husk, dry husk, gluten, oil and oil cakes etc. - exempt goods - Rule 6 (3) of Cenvat Credit Rules, 2004 - Held that - Admittedly, the Adjudicating Authority has dropped the demand by treating the entire period being prior to 1/3/2015. As such his findings on the Explanation 1 introduced with effect from 1/3/2015 are not available - we set aside a part of the impugned order, for the period post 1/3/2015 and remand the matter back to Commissioner to consider the Explanation 1 to sub Rule 1 of Rule 6 and give his findings on the same. Appeal allowed by way of remand.
Issues: Revenue's appeal against dropping of demand for the period prior to 1/3/2015, and the applicability of Rule 6(3) of Cenvat Credit Rules post 1/3/2015.
Analysis: 1. The Revenue filed an appeal against a part of the order by the Commissioner, challenging the dropping of demands raised through show cause notices. The appellant, engaged in starch manufacturing, availed Cenvat Credit on raw materials. The Revenue demanded payment for waste materials exempted from duties under Rule 6(3) of Cenvat Credit Rules. 2. The Commissioner dropped demands pre-1/3/2015, citing precedents that exempted waste materials. The Revenue contended that post 1/3/2015, Explanation 1 to Rule 6 included non-excisable goods cleared for consideration. The Adjudication Authority dropped the demand for the entire period pre-1/3/2015. 3. The respondent argued that a part of the demand was post 1/3/2015, questioning the applicability of Rule 6(3) even post this date. The Tribunal noted the Commissioner's error in treating the entire period pre-1/3/2015, without considering Explanation 1 post 1/3/2015. The matter was remanded to the Commissioner for further consideration. 4. The Tribunal clarified that it did not express views on the case's merits, allowing the assessee to contest before the Adjudicating Authority. The Revenue's appeal was allowed for remand, and the cross-appeal was disposed of accordingly.
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