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TMI Blog2018 (10) TMI 1153X X X X Extracts X X X X X X X X Extracts X X X X ..... gricultural waste of sugarcane and the waste and residue of agricultural products, during the process of manufacture of goods cannot be said to be result of any process. There is no manufacturing process involved in Bagasse’s production. “Bagasse” is not ‘goods’ but merely a waste or by-product, therefore Rule 6 of CENVAT Credit Rules, 2004 is not applicable in the present case - “Bagasse” is bound to come into existence during the crushing of the sugarcanes and is an unavoidable agricultural waste. For two reasons the Board’s Circular dated 25.04.2016 has no application on the facts of the instant case, firstly no Circular can override the Rules as well as the law laid down by the Hon'ble Supreme Court and the orders of this Tribunal, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 to June, 2015 they have neither maintained separate CENVAT credit account for the dutiable product and exempted product as required under Rule 6(2) of the CENVAT Credit Rules, 2004, nor followed the procedurel under Rule 6(3A) of the CENVAT Credit Rules, 2004 and therefore a show-cause notice dated 10.11.2015 was issued to the Appellant as to why: (a) An amount of ₹ 14,75,046/- (Rs. Fourteen Lakhs Seventy Five thousands and Forty Six only) equal to 6% of sale value of Bagasse should not be demanded and recovered from them under Rule 14 of CENVAT Credit Rules, 2004 read with Section 11A(1) of the Central Excise Act, 1944. (b) The interest on amount of ₹ 14,75,046/- should not be charged and recovered from them under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . He cited a numbers of decisions of the Hon'ble Supreme Court as well as of the Hon'ble High Court and also of this Tribunal in support of his arguments that no amount is to be paid and also that reversal of CENVAT credit under Rule 6 of CENVAT Credit Rules, 2004 is not required in respect of waste or by-product or refuse generated during the process of manufacturing. The list of cases cited by him are as under:- (i) Union of India Others Vs. DSCL Sugar Ltd. 2015 (322) ELT 769 (SC) (ii) Rallis India Ltd. Vs. Union of India - 2009 (233) ELT 301 (HC-Bom.) (iii) M/s Indreshwar Sugar Mills Ltd. Others etc. Vs. CCE, Pune-III Final Order No. A/90687-90703/17/SMB, dated 15.11.2017 (iv) Athani Sugars Ltd. Others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nserted to Rule 6 of CENVAT Credit Rules, 2004 vide notification dated 01.03.2015, a view was taken by the Revenue that Bagasse being non-excisable goods and since it was cleared from the factory against consideration, therefore it would come within the scope of Rule 6 of the CENVAT Credit Rules, 2004. The said explanation to Rule 6 read as under:- Rule 6(1) The Cenvat credit shall not be allowed on such quantity of inputs used in or in relation to the manufacture of exempted goods or for provision of exempted services, or input service used in or in relation to the manufacture of exempted goods and their clearance upto the place of removal or for provisions of exempted service except in the circumstances mentioned in sub-rule(2): Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rule 6 of CENVAT Credit Rules, 2004 is not applicable in the present case. Bagasse is bound to come into existence during the crushing of the sugarcanes and is an unavoidable agricultural waste. For two reasons the Board s Circular dated 25.04.2016 has no application on the facts of the instant case, firstly no Circular can override the Rules as well as the law laid down by the Hon'ble Supreme Court and the orders of this Tribunal, and secondly the said Circular was issued on 25.04.2016 i.e. on a later date, whereas the period in dispute is March, 2015 to June, 2015. 9. Almost all the decisions cited by Learned Counsel for the appellant are on identical issue and in all the decisions, this Tribunal has taken a consistent view that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emoval of non-dutiable waste or by product is settled in favour of the assessee. As regard the submissions made by Ld. ARs that after insertion of explanation in Rule 6(1), even in case of non-excisable goods, the reversal under Rule 6(3) is required. In this regard he referred to the Hon ble Supreme Court judgment in the case of DSCL Sugar Ltd.(supra). Wherein the Hon ble Supreme Court has held that in case of non-manufactured/non-excisable goods under Rule 6(3) would not apply and after the amendment in Rule 6(1) by inserting explanation, the ratio of the Hon ble Supreme Court judgment will not applicable for the period after amendment. On careful consideration of this submission, I find that the issue before the Hon ble Supreme Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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