Vandana Global Ltd. Vs Commissioner of Central Excise and Service Tax (CESTAT Delhi)
Whether for the electricity generated by the appellants for captive consumption, some part whereof has been sold to state electricity body, the appellants are not liable to take the credit on such amount of electricity as has been sold out.
It is required to adjudicate as to whether the electricity is an exempted good to cover the case of the appellants within the scope of Rule 6 of CCR, 2004.
In the present case, Cenvat credit has been taken on the inputs used, however, suo moto proportionately reversed for the electricity which has been sold out. Further, I observe the Rule 6 of CCR, 2004 gives three separate options to the assessee as mentioned under sub rule (1), (2) and (3) thereof and to exercise any one of these options is the prerogative of assessee. The department cannot compel the assessee to opt for a particular option. Further, w.e.f. 01.04.2008 Rule 6 (3A) has been introduced, according to which the assessee is eligible to reverse proportionate credit on inputs and input services used in manufacture of exempted goods. Instead of reversal at the rate of 10% / 5% as prescribed by Rule 6 (3) of CCR, 2004 apparently and admittedly the said reversal has already been made. The excess amount of duty over and above the amount of Rs.10,19,252/-, department has confirmed the duty while adding the value of electricity as was generated from scrap as that of Windmill, Fly Ash etc., as already mentioned above. The case of Gularia Chini Mills (Supra) has already settled that electricity generated out of waste, provisions of Rule 6 (3) of CCR, 2004 are not applicable. The said decision has been followed by this Tribunal in DSM Sugar Mills Limited (supra) case. I find no reason to differ from these decisions. Accordingly, it is held that Commissioner (Appeals) has laid wrong emphasis on the decisions as mentioned in the order under challenge.
