BILAG INDUSTRIES P. LTD. Vs. CCE

JUDGEMENT

(1.) THIS appeal has been filed by the appellant with respect to OIO No. 04/DEM/DAMAN/2011, dt. 28.02.2011 passed by Commissioner, Daman under which demand of Rs. 2,34,40,629/ - has been confirmed against the appellant, along with interest and equivalent penalty has also been imposed.

(2.) FACTS of the case are that appellant is holding Central Excise Registration for the manufacture of excisable goods falling under Chapters 28, 29 & 38 of the Central Excise Tariff Act, 1985. Appellant is having a sister concern situated as M/s. Bilag Industries (100% EOU), Plot No. 143, 2nd Phase, GIDC, Vapi and a corporate office. During the course of an audit of the records of the appellant by the officers of the jurisdictional Central Excise, Customs & Service Tax Commissionerate, Daman in March, 08 & May, 08, it was observed that appellant had a captive power plant, located in its factory premises. The said noticee had used cenvatable inputs viz., furnace oil to generate electricity and also to produce steam. A part of this electricity and steam was supplied to its sister concern viz., M/s. Bilag Industries P. Ltd. (100% EOU), situated outside its factory premises. Further, it was also noticed that appellant had not reversed proportionate CENVAT Credit attributable to the furnace oil used in the production of electricity which had been supplied to its said sister concern and corporate office situated near its factory, in terms of Rule 6(3)(a)(iv) of the CCR, 2004 and that it had not paid 10% of the price of the steam transferred to its said sister concern, and corporate office situated at Plot No. 306/3, 2nd Phase, GIDC, Vapi. The demands raised were confirmed by the adjudicating authority under OIO dt. 28.02.2011 against which the present appeal has been filed.

(3.) DR . Jeetesh Nagori (AR) appearing on behalf of the Revenue argued that as per the judgment of the Apex Court in the case of Maruti Suzuki Vs. CCE [ : 2009 (240) ELT 0641 (S.C.)] the CENVAT Credit of fuel used for generating electricity and steam, supplied to its sister concern and the corporate office is not admissible as the same are situated outside the factory premises. Ld. A.R. thus defended the order passed by the lower authority.