Availment of accumulated MODVAT /CENVAT Credit on molasses for payment of duty on sugar

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..... s being adopted by the field formations regarding utilisation of credit of duty paid on molasses for payment of duty on sugar being cleared by the sugar manufacturing units. It has been reported by some of the Commissionerates that molasses is a finished product and hence no credit of the duty paid on the molasses can be utilised for payment of duty on sugar. On the other hand, some field formatio .....

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..... y manufacture sugar, molasses and Ethyl Alcohol dutiable, exempted and non-excisable. In case, Ethyl Alcohol non-excisable or exempted is manufactured, the duty becomes payable on molasses and no credit of duty paid on "in-house" manufactured molasses shall be available. In case, the ethyl alcohol is cleared on payment of duty, no duty is required to be paid on molasses and hence, no question of a .....

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..... which is altogether a separate entity, credit of duty paid on such molasses can be utilised by the latter entity. 3. It would thus be clear form the above clarification that each has to be decided on its merits in the light of above guidelines and Cenvat issue settled accordingly. 4. Trade and field formations may be suitably informed. F.No.267/80/98-CX.8 - Circular - Trade Notice - .....

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