Custom, Excise & Service Tax Tribunal
M/S Mankapur Chini Mills vs Commissioner Of Central Excise & ... on 3 January, 2018
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL REGIONAL BENCH : ALLAHABAD COURT No. I APPEAL No. E/1205/2012-EX[DB] (Arising out of Order-in-Appeal No. 15/CE/APPL/ALLD/2012 dated 13/02/2012 passed by Commissioner (Appeals), Central Excise, Allahabad) M/s Mankapur Chini Mills Appellant Vs. Commissioner of Central Excise & Service Tax, Allahabad Respondent
Appearance:
Ms. Rinki Arora (Advocate) for Appellant Shri Mohd. Altaf (Asstt. Commr.) AR for Respondent CORAM: Honble Mrs. Archana Wadhwa, Member (Judicial) Honble Mr. Anil G. Shakkarwar, Member (Technical) Date of Hearing : 03/01/2018 Date of Decision : 03/01/2018 FINAL ORDER NO. 70143/2018 Per: Archana Wadhwa
After hearing both the sides duly represented by Ms. Rinki Arora (Advocate) and Shri Mohd. Altaf (Asstt. Commr.). We find that the appellant was engaged in manufacture of Sugar and Molasses as also Denatured Alcohol. During the course of manufacture of Denatured Alcohol, Carbon Di Oxide Gas (Co2) come into existence, which was initially being vented out by the appellant. However during the period relevant for the purposes of the present appeal i.e. from April, 2010 to December, 2010, the appellant sold Carbon Di Oxide (Co2) without payment of duty.
2. In view of the above background, proceedings were initiated against the appellant by way of issuing a show cause notice dated 04/05/2011 proposing to confirm the demand of Rs.3,46,206/- on the Carbon Di Oxide (Co2) Gas, cleared by them. The notice culminated into an order passed by the Original Adjudicating Authority confirming the demand along with interest and imposing penalty of identical amount. The said order of Lower Authorities stands confirmed by Commissioner (Appeals).
3. The appellant have taken a categorical stand before the authorities that they are not engaged in the manufacture of Carbon Di Oxide (Co2) inasmuch as the same came into existence as a byproduct during the course of manufacture of Denatured Spirit. We also note that the demand stands confirmed against the appellant @10% of the sale value of the same in terms of provisions of Rule 6 of Central Excise Rule. The Honble High Court of Bombay in the case of Rallis India Ltd. Vs. Union of India 2009 (233) E.L.T. 301 (Bombay) has set aside the order of the Larger Bench of the Tribunal and has held that the provisions of payment of a particular percentage of the value of the exempted product in terms of the erstwhile Rule 57CC of Central Excise Rule would not apply to the exempted byproducts. We also take note of Honble Supreme Court decision in the case of Union of India Vs. Hindustan Zinc Ltd.- 2014 (303) E.L.T. 321 (S.C.), laying down that unintended byproduct, which emerge during the course of manufacture of the final product, would not call for payment of any particular percentage of the value of the same in terms of erstwhile Rule 57CC. We note that the present provision of Rule 6(3) are pari metere to Rule 57CC of erstwhile Central Excise Rule and as such, ratio of law declared in the said decisions would fully apply.
4. By following the above decisions, we set aside the impugned order and allow the appeal with consequential relief to the appellant.
(Dictated & Pronounced in Court) Sd/- Sd/-
(Anil G. Shakkarwar) Member (Technical) (Archana Wadhwa) Member (Judicial) Lks 1 2 APPEAL No. E/1205/2012-EX[DB]