MADRAS ALUMINIUM COMPANY Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE lower authorities have denied input duty credit of Rs. 11,435 to the appellants in respect of petroleum coke, superior kerosene oil (SKO) etc which were used in the generation of electricity during the period June 2003 to March 2004. Such denial is on the ground that a part of the electricity so generated was not used within the factory but supplied to the Tamil Nadu Electricity Board.

(2.) AFTER examining the records and hearing both sides, I find that the Revenue's stand is based on the following text of the definition of "input" under Rule 2(g) of the Cenvat Credit Rules 2002. "Inputs" means all goods, (light speed oil) high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final products or not, and includes lubricating oils, greases, cutting oils and coolants and accessories of the final products cleared along with the final product, goods used as paint, or as packing material or as fuel, or for generation of electricity or steam used for manufacture of final products for any other purpose, within the factory of production. Ld. SDR referred to the above definition and has submitted that, insofar as the fuels used for generation of electricity captively within the factory of production of final products are concerned, the electricity so generated must be used for some purpose within the factory so that input duty credit could be taken on such fuels. A similar argument, for a previous period (July 2002 to May 2003), was considered in an earlier case of the same assessee and therein it was held that, prima facie, the assessee was eligible for such input duty credit. Accordingly, waiver and stay were granted to the assessee vide Stay Order No. 934 - 935/2005 dated 21st November, 2005 in appeal No. E/1297/04.

(3.) FOLLOWING the above precedent, I grant waiver of pre -deposit and stay of recovery in respect of the amount of duty involved in the present case.