PONNI SUGARS AND CHEMICALS LTD. Vs. CCE

JUDGEMENT

(1.) THE appellants are manufacturers of sugar and molasses, both dutiable products. During the period of dispute (9/96 to 5/97), they removed press -mud (which was generated during the course of manufacture of the above products) without payment of duty. They had also availed input duty credit on phosphoric acid. The department took the view that they were not eligible for this credit, but were required to pay 8% of the sale price of press -mud to the department under Rule 57CC of the CE Rules, 1944. This demand was contested on the ground that residues such as press -mud were not excisable. The lower authorities did not accept this contention of the party and consequently the demand was confirmed. Hence the present appeal.

(2.) AFTER hearing both sides, I find that it is now settled law that press -mud generated in the course of manufacture of sugar is not an excisable item. The Hon'ble Supreme Court in the case of CCE Meerut vs. Titawi Sugar Complex reported in 2003 (54) RLT 859 (SC) cited by the learned Counsel for the appellants held so and the CBEC has accepted the Supreme Court's verdict vide Circular No. 730/46/2003/CX. dated 31.7.2003. In view of the non -excisability of press -mud, there is no question of invocation of Rule 57CC for raising any demand on the item in this case. The impugned order is set aside the appeal is allowed.