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TMI Blog2016 (1) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... e final product. The issue is squarely covered on all four by the ruling of the Honourable High Court and Supreme Court as relied on by the ld. Counsel for the respondent. In this view of the matter I hold that the respondent assessee is entitled to Cenvat credit on services received in the manufacture of absolute alcohol or rectified spirit, which have been further used for manufacture of denatured spirit, cleared on payment of duty. - Decided in favor of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, in all sense and accordingly it appeared that all plant machinery equipment as well as services used in the manufacture of absolute alcohol are being used exclusively in the manufacture of non-excisable/exempted products. Accordingly two separate show cause notices were issued for the period 2005-06 and 2006-07 and an other notice for the period June 2008 to Feb., 2009 requiring the assessee to show cause as to why inadmissible Cenvat credit of service tax on input service, should not be demanded and recovered from them under Rule 14 of CCR read with Rule 6 (3) read with section 73 of the Act along with interest and penalty. 3 The respondent contested the SCN and the same was adjudicated vide order in original dated 23/7/09 and 9/11/09 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it have been held that Cenvat credit on input services used in the distillery for manufacture of None dutiable/exempted intermediate product which in turn are used for manufacture of final dutiable product is eligible to the respondents. 5. Being aggrieved the revenue is in appeal before this Tribunal on the ground among others that prior to 1/3/05 rectified spirit was classifiable under the heading number 2204. 90 of the CET Act attractive nil rate of duty. With effect from 1/3/05 the product does not find any place in the 8 digit tariff, effectively making it a non- excisable commodity. Rectified spirit Absolute alcohol has been defined in various dictionaries as concentrated alcohol fit for drinking and which is obtained by repeated pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e High Court held that the Tribunal rightly held that clearing of goods at intermediate stage was not at part with clearing of exempted goods. Under the circular of the Board (665/56/2002 - CX dated 25/9/02) as well as the scheme of Act and the rules, Cenvat credit is permissible to a job worker and even to a manufacturer at intermediate stage of inputs likely, lubricants, soaps, chemicals, et cetera used in the manufacture of final products on which duty was admittedly paid. Object of Cenvat credit is to avoid cascading effect of duty. The ld. Counsel also relies on the ruling of Honourable Madras High Court in the case of CCE versus Singaravelar Spinning Mills Private Ltd. : 2009 (241) ELT 497 wherein capital goods were used for producing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee to the other factory where the assessee was availing/taking modvat credit in respect of duty paid on inputs used in the manufacture of parts and those parts were cleared to another factory of the same assessee, without payment of duty by virtue of notification number 217/86, and the parts were then used for manufacture of tractor which were cleared on payment of duty. Revenue had disputed that modvat credit was not admissible as the final goods that is parts were cleared without payment of duty. The Honourable Court have held that in cases where intermediate product comes into existence, even though no duty is paid on the intermediate product as it is exempted from the duty or is chargeable to nil rate of duty, credit will still be al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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