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TMI Blog2013 (9) TMI 937X X X X Extracts X X X X X X X X Extracts X X X X ..... vat Credit on Furnace Oil and other eligible goods used in generator of electricity has been allowed. M/s Jindal Polyester came into existence as factory manufacturing Partially Oriented Yarn and M/s Jindal Polymer is manufacturing Polymer Chips. M/s Jindal Polyester( a division of M/s Jindal Polfilm Ltd.) was availing Cenvat Credit of duty paid on Furnace Oil which was used as fuel in the DG sets for generation of electricity. A team of Central Excise Officers, Noida visited the factory premises of Jindal Polyster on 10.12.2004. It was found that there were two manufacturing units having their registered factory premises adjacent to each other. One of such unit was registered under Central Excise in the name of M/s Jindal Polymer having ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d counsel for the appellant submits that in view of Rule 57-AA of the Central Excise Rules Modvat Credit is not admissible to the second unit. Elaborating the argument, he submits that since the two units are producing different products, they should be treated as separately. In reply, the learned counsel for the respondents submits that the term factory has been defined in Section 2(e) of the Central Excise Act. The two units constitute one factory and therefore, both the units are entitled to claim Modvat. Considered the respective submissions of the learned counsel for the parties and perused the record. The learned counsel for the appellant has placed reliance upon Rule 57-AA particularly Clause(d) which is reproduced below: Rule 57 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .- Chennai), it has been held that it is well-settled that tax law should be interpreted in conformity with the normal commercial practice. Therefore, the manner of use should be accepted as to economical, efficient and convenient manner of use. A contrary interpretation would lead to frustrating the purpose of law in granting exemption/Modvat credit. Generation of electricity in one unit for use in all the neighbouring units of a manufacturer is more efficient and economical than setting up generating facility at each and every factory. In Mahabir Jute Mills Ltd. versus Commissioner of C. Ex., Allahabad 2007(220) E.L.T 121 (Tri.- Del.), it has been held that if separate registration is given for polyester yarn manufacturing facility locat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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