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TMI Blog2019 (4) TMI 2119X X X X Extracts X X X X X X X X Extracts X X X X ..... which are a necessity of the manufacturing products. It cannot be accepted that the heat entrapped in flue gases which emerge during the process as waste or by-product can be regarded as a final product which is beneficially used by the appellant for manufacture of electricity. The ratio of the Hon ble Supreme Court judgment in the case of UNION OF INDIA OTHERS VERSUS M/S. HINDUSTAN ZINC LTD. [ 2014 (5) TMI 253 - SUPREME COURT] is squarely applicable to the issue in hand, where it was held that the requirements of 57CC were fully met in the way in which the Respondent was maintaining records and inventory and the mischief of recovery of 8% under Rule 57 CC on exempted sulphuric acid is not attracted. Time Limitation - HELD THAT:- Even on limitation as the issue is squarely based on interpretation of law, it is held that the charge of willful suppression does not sustain and extended period of limitation is not applicable. The appeal is allowed. - Shri Ashok Jindal, Member (Judicial) And C.L. Mahar, Member (Technical) For the Appellant : Shri Vivek Shukla, Advocate For the Respondent : Shri H.C. Saini, Authorized Representative (DR) ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Commissioner (Appeals) to 50% of the demand in case where the records of such Cenvat credit are maintained in electronic form for the period upto assent to Finance Act, 2015 (i.e. 13th May, 2015). 3. In the appeal memorandum as well during the course of hearing, the learned Counsel appearing on behalf of the appellants has vehemently agitated the confirmation on the ground that the waste heat coming out of the Sponge unit plant is not a final product, but is waste and refuse and such waste heat is unintended outcome of melting process. Since the waste heat is not a final product, its use in generation of electricity is not liable for Reversal of any Cenvat Credit and there is no application of rule 6 in the present case. That during the process of manufacturing activity, waste heat is released by the DRI Plant (Sponge Iron kilns). Such waste heat is utilized for generating electricity by treating it with water in the Waste Heat recovery Plant installed in the factory premises. In Waste Heat Recovery based power plant(WHRB), no other input, except waste heat generated from the manufacture of sponge iron, is used. The waste heat is generated out of the flue gas which comes out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as an amount under Rule 57 CC of CER, 1944 or Rule 57 D ibid or Rule 6 of CCR 2004, on the value of by-product namely, sulphuric acid which was cleared to fertilizer plant under exemption, in terms of the bonds executed by the fertilizer plant. 4. The Apex court examined in detail the manufacturing process and after considering the submissions of the Revenue that Rule 57CC and Rule 6 of the modvat/Cenvat Credit Rules respectively, which Rule require the interpretation, which needs to be applied as the language of these are unambiguous in this regard. The Court recorded that as per the general provisions of Rule 57CC or Rule 6, are common for use of inputs into final products that is one dutiable and the other exempted, for the applicability of the same. When two final products emerge out of use of common inputs, one excisable and other exempt, the provisions will apply. The question of intention of the assessee to manufacture the exempted product is not relevant. It may be intended or unintended, but what results in the course of a manufacturing process is a final product falling within the meaning of the said provisions, the provisions will apply in full with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing manufactured with the same common inputs becomes understandable. This Rule did not talk about emergence of final product and a by-product and still said that Rule 57CC will apply. The appellant seeks to apply Rule 57CC when Rule 57D does not talk about application of Rule 57CC to final product and by-product when the by-product emerged as a technological necessity. Accepting the argument of the appellant would amount to equating by-product and final product thereby obliterating the difference though recognised by the legislation itself. Significantly this interpretation by the Tribunal in Sterlite (supra) was not appealed against by the department. 27. We are also unable to agree with the submission of the learned Solicitor General that judgment in GAIL s case is not applicable. Significantly, the question as to whether Rule 57CC will apply when by-products are cleared without payment of duty came for discussion in that case. It was held that so long as the lean gas was obtained as a by-product and not as a final product, Rule 57CC will not apply. We are, therefore, of the view that the respondent s case is squarely covered by the judgment in GAIL s case. The Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X
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