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TMI Blog2021 (8) TMI 685X X X X Extracts X X X X X X X X Extracts X X X X ..... nst upholding of order-in-original No. 14/CGST-Solapur/2017-18 dated 25.10.2017. It has been confirmed by the counsel for the appellant that no appeal has been filed against the upholding of second order-in-original i.e. 05/CGST-Solapur/2017-18 dated 21.08.2017. Therefore, this order is limited to the order appealed against. Appeal allowed - decided in favor of appellant. - Excise Appeal No. 86407 of 2018 - FINAL ORDER NO. A/86670/2021 - Dated:- 2-8-2021 - MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) AND DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL) Shri Deepak Marne, Advocate, for the Appellant Shri N.N. Prabhudesai, Superintendent, Authorised Representative for the Respondent ORDER This appeal is directed against Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f electricity within the factory. The electricity so generated is partly used for the manufacturing process within the factory and partly sold out to Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL). 2.2 As per revenue, the electricity sold out to the electricity company is liable to payment of 6% of amount received from MSEDCL towards sale of electricity, in terms of Rule 6 (3) (i) of Cenvat Credit Rules, 2004. During the period January to March 2016, appellants received ₹ 3,00,09,618/- (excluding taxes) from MSEDCL 2.3 A show cause notice dated 02.08.2017 was issued to the appellant asking them to show cause as to why- i. An amount of ₹ 18,00,577 (Rupees Eighteen Lakhs five hundred and seventy seven on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.3 Learned Authorized Representative re-iterates the findings of the lower authority and asks for dismissal of the appeal. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 In the case of Appellants themselves tribunal has vide its order reported at 2018-TIOL-1845-CESTAT-MUM, Mumbai bench of tribunal held as under, 3. Shri A.B. Kulgod, Ld. Asst Commissioner (AR) appearing on behalf of the Revenue reiterates the findings in the impugned order. He further submits that as per instructions of explanation-1 vide Notification No.06/2015-CE (NT) dated 01/03/2015 in Rule 6 of Cenvat Credit Rules, 2004 for the purpose of Rule 2 (d) and (h) of Cenvat Credit Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will only apply where a manufacturer manufactures both the excisable dutiable final products and also manufactures excisable exempted goods. Furthermore, for the applicability of Rule 6, manufacture of dutiable goods and manufacture of exempted goods are condition precedent. Thus, the law is well settled that bagasse is not manufactured goods but is a waste product, which emerges/comes into existence in the process of manufacture of sugar. Hence, it is not manufacture of exempted goods. Similarly, electricity is not exempted excise goods as held by the Supreme Court in Solaris Chemicals Ltd. (supra). 25. It is not in dispute that petitioners do not avail Cenvat credit on any input and input services used in generation of electricity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uts which are used for manufacture of dutiable and exempted final products then the assssee is required to reverse the proportionate credit or pay 10%/5% amount of the value of the exempted final products. Electricity is not excisable goods under Section 2(d) of the Act, hence Rule 6 of the Cenvat Credit Rules, 2004 is not applicable as held by the Apex Court in the case of Solaris Chemtech Ltd. (supra). 29 . 30 .. 31 . 32 33. At the cost of repetition, we may add that the electrical energy generated from Naphtha, furnace oil, coal, etc., has been included under Chapter 27 as excisable goods on which the excise duty is being paid and the credit is taken in respect of the excise duty paid on such inputs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he stage of emerging of bagasse which is a waste and which emerges on the crushing of sugarcane. Thus, we have no hesitation to say that electrical energy emerges from the bagasse and sold to U.P. Power Corporation Ltd. does not fall within the ambit of excisable goods. 5. From the above judgement, we observed that the Hon ble High Court has held that since in the generation of electricity from bagasse, no other inputs or input service used. Therefore, the electrical energy is neither excisable under Section 2 (b) of the Central Excise Act, nor exempted goods. Hence, Rule 6 is not applicable. We, therefore, following the ratio of the above High Court judgement, set aside the impugned order and allow the appeal. 4.3 As seen from p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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