Custom, Excise & Service Tax Tribunal
M/S Bhima Sahakari Sakhar Karkhana Ltd vs Commissioner Of Central Excise, Pune ... on 15 July, 2013
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Application No. E/S/94254/2013-Mum. In Appeal No. E/86224/2013-Mum. (Arising out of Order-in-Appeal No. P-III/RP/285/2012 dated 1212.2012 passed by the Central Excise (Appeals), Pune III. ) For approval and signature: Honble Mr. S.S. Kang, Vice President Honble Mr. P.K.Jain, Member (Technical) ============================================================
1. Whether Press Reporters may be allowed to see :
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy :
of the Order?
4. Whether Order is to be circulated to the Departmental :
authorities?
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M/s Bhima Sahakari Sakhar Karkhana Ltd.
:
Appellant
VS
Commissioner of Central Excise, Pune III
:
Respondent
Appearance
Shri Vidyadhar S. Apte, Advocate for Appellant
Shri Ahibaran, Addl. Commr. (AR) for respondent
CORAM:
Mr. S.S. Kang, Vice President
Mr. P.K. Jain, Member (Technical)
Date of hearing : 15/7/2013
Date of decision : 15/7/2013
ORDER NO.
Per : S.S. Kang
Heard both sides.
2. Applicant filed this application for waiver of pre-deposit of dues.
3. We find that the issue is settled in favour of the applicant therefore we take up the appeal for disposal.
4. The appellants are engaged in the manufacture of sugar. For the manufacture of sugar the appellant are crushing sugarcane. Sugarcane juice is further used in the manufacture of sugar. The Bagasse and pressmud which is residue of sugarcane, generated during crushing, is cleared without payment of duty. The demand is confirmed in view of provisions of Rule 6 of CENVAT Credit Rules, 2004 on the ground that appellants were taken credit in respect of common inputs and input service hence are liable to pay 5% / 10% of price of Bagasse and pressmud cleared without payment of duty.
5. We find that the issue is now settled by the decision of Honble High Court of Allahabad in the case of Balrampur Chini Mills Ltd. vs. Union of India and Others in Writ Petition No. 11791 (M/B) of 2010 order dated 18.5.2012. The Honble High Court after taking into consideration the decision of the Supreme Court in the case of CCE vs. Shakumbhari Sugar & Allied Industries Ltd. (supra) held that bagasse generated from the crushing of the sugarcane which is neither manufactured goods nor manufactured final product, but it is a residue/waste and the demand by invoking the provisions of Rule 6 of CENVAT Credit Rules, 2004 is not sustainable. Further, we find that the Tribunal in the case of Indian Potash Ltd. in Appeal No. E/2957/11 vide order dated 20.04.2012 after taking into consideration the decision of the Honble Supreme Court in the case of Shakumbhari Sugar & Allied Industries Ltd. (supra) also taken the same view and held as under:-
6. We have considered the rival submissions. We find that bagasse emerges in course of crushing of sugarcane. It may be noted that crushing of sugarcane is necessary to extract can sugar juice which in turn is processed for production of sugar and molasses. Bagasse is the waste product left after the crushing of sugarcane. Therefore, by no stretch of imagination it can be said that the assessee possible could have maintained separte account for the inputs for production of sugar and molasses (excisable item) andd bagasse. Thus, in our considered view, the amendment in Finance Act, cited by Shri Nagesh Pathak, AR and the Board Circular would not make any difference in the facts and, circumstances of the case. Moreover, neither the show-cause notice nor the impugned order in appeal mentions as to which common CENVAT credit availed inputs have been used in manufacture of sugar and molasses (dutiable final products) and bagasse (exempted final product). Since Bagasse emerges at sugarcane crushing stage, there is no possibility of any input-chemicals etc. having been used at that stage. Accordingly, we find merit in the contention of the appellant. The impugned order is set aside. The appeal and station applications are allowed.
6. We find no reason to take contrary view. As the issue involved in the present case is already decided by the above mentioned decisions hence, the impugned order is set aside. The stay petition and appeal is allowed.
(Dictated in court) (P.K. Jain) Member (Technical) (S.S. Kang) Vice President Sm ??
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