JUBILANT ORGANOSYS LTD. Vs. CCE

JUDGEMENT

(1.) WHEN the stay application came up for hearing, learned Counsel for the appellant points out that the issue raised in the appeal remains settled in favour of the assessee under the order of this Tribunal and that order has been confirmed also by the Apex Court. In view of this legal position, the appeal itself was taken up for consideration, after dispensing with the requirement for pre -deposit of duty and penalty.

(2.) THE appellant is a manufacturer of Glycol, Surfactants, Fusel Oil, Plymeg and H.S Alcohol. The appellant's main input is molasses. A small percentage of molasses brought in to the appellant's factory and stored in the tanks get lost on account of natural reasons (evaporation). Under the impugned order, the Central Excise authorities have held that quantities of molasses so lost are not used in or in relation to the manufacture of final product and therefore, no modvat credit could be taken "on those quantities. Accordingly, duty demand had been confirmed.

(3.) THE submission of the appellant is that the very issue came up before this Tribunal in the case of Kesar Enterprises Ltd. v. CCE, Lucknow, 2002 (105) ECR 900 and the Tribunal held that the assessee is eligible for credit in respect of the full quantity of input brought in i.e. including the molasses lost during storage. While passing this order, the Tribunal noted that the Circular dated 6.2.82 of the Board had accepted loss up to 2% during storage as normal in respect of molasses and was required to be condoned. This order of the Tribunal was taken in appeal to the Supreme Court and the Hon'ble Supreme Court dismissed the appeal 2003 (159) ELT A -256.