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1. This appeal is filed by M/s Ugar sugar Works Ltd., Belgaum, against the Order (Original) No. 13/2001 dated 18.12.2001, passed by the Commissioner of Central Excise, Belgaum.

2. The appellants are engaged in the manufacture of Sugar. During the process of manufacture of Sugar, Molasses falling under Tariff Sub Heading 1703.90 also emerges as a by-product. The Molasses was mostly being captively used by them in their distillery for manufacture of Rectified Spirit and a part of it was also being sold, on payment of appropriate duty, to the buyer. The entire quantity of molasses either to their distillery or to the outside buyers was cleared on payment of duty. They took credit of duty paid on the molasses which was being captively consumed by them in their distillery for the manufacture of rectified Spirit. The Rectified Spirit is chargeable to nil rate of duty under Sub Heading 2204.90. A portion of rectified Spirit was also cleared as such to other parties and a portion of the same was utilised by the appellants for manufacture of Denatured Ethyl Alcohol, Amyl Alcohol and Indian Made Liquor in their distillery The appellant has followed the procedure of the then Rule 57CC / Rule 57AD by paying 8% of value on exempted final product, namely Rectified Spirit and paid appropriate duty on the excisable products.