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TMI Blog2011 (6) TMI 599X X X X Extracts X X X X X X X X Extracts X X X X ..... of the final products. - order is held as correct and legal to the extent it confirms the demand of reversal, but is incorrect in upholding the penalty. - 1833 OF 2009-(SM) - 431/2011-SM(BR) - Dated:- 23-6-2011 - M.V. RAVINDRAN, J. Sourabh Yadav for the Appellant. S.K. Bhaskar for the Respondent. ORDER 1. This appeal is filed by the appellant against the Order-In-Appeal No. 171/BPL/2009, dated 30.03.2009. 2. The relevant facts of the case is that the appellant herein are manufacturer of paper and paperboard. 3. The appellant also manufactures paper and paperboard, produces electricity with the help of generator and the electricity so produced is utilized in the manufacturing of paper and paperboard and is also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e into manufacturing/production of electricity which was consumed in the residential colony/guesthouse/schools/ hospitals etc. by the appellant. It is undisputed that these residential colony/guesthouse/schools/hospitals etc. are within the factory premises. I find that the Hon'ble High Court of Bombay in the case of Indo-Rama Synthetics (India) Ltd. ( supra ) had an occasion to decide an identical issue. After considering the relevant submissions, their Lordships held : "18. We have carefully considered the rival submissions. The basic dispute in the present case revolves on the meaning of the words "any other purpose" contained in rule 57B(iv) of the Central Excise Rules, 1944 as well as similar rule contained in the Cenvat Credit Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee within the licensed premises to facilitate storage/repair of the machinery used in the production of the final products, it would be covered within the meaning of the words "any other purpose" in rule 57B(iv) of the Central Excise Rules, 1944. 21. The fact that the residential complexes are situated within the licensed premises would not entitle the assessee to avail credit of duty paid on furnace oil used in the manufacture of electricity supplied to the residential complexes. It is necessary to establish that the electricity is used for any purpose connected with or related to the production of final products. In our opinion, supply of electricity to the residential complexes situated within the factory premises are neither con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case ( supra ). Since the view has been confirmed by the highest court of India, there can be no other view on an identical issue. Since the issue involved in this case regarding the reversal of proportionate Cenvat credit as inputs used for the manufacturing/production of electricity which is consumed in the residential colony/guesthouse/schools/hospitals etc. was in dispute and had to be upheld by the highest court, in my considered view, the penalty imposed by the adjudicating authority as appellant is unwarranted. I set aside the penalty as imposed by the adjudicating authority and upheld by the impugned order. 9. In the light of the foregoing, in the fact and circumstances, the impugned order is held as correct and legal to the e ..... X X X X Extracts X X X X X X X X Extracts X X X X
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