Page 133 - GSTL_2nd July 2020 _Vol 38_Part 1

2020 ] MINERA STEEL & POWER PVT. LTD. v. COMMISSIONER OF C.T., BELAGAVI 51
requirement of Rule 6(3A) ibid - Demand of 6% of value of electricity sold not
sustainable in law. [para 6]
Appeal allowed
CASES CITED
Commissioner v. Hi-Tech Carbon — 2018 (17) G.S.T.L. 398 (All.) — Relied on ...................... [Paras 4.1, 6]
Commissioner v. Sri Sai Sindhu Industries Ltd.
— 2017 (49) S.T.R. 84 (Tribunal) — Referred .......................................................................... [Paras 5, 6]
Minera Steel & Power Pvt. Ltd. — Final Order No. 21815-21818/2018, dated 29-11-2018
by CESTAT, Bangalore — Relied on ..................................................................................... [Paras 4.1, 6]
Rallis India Ltd. v. Union of India — 2009 (233) E.L.T. 301 (Bom.) — Relied on ..................... [Paras 4.1, 6]
Union of India v. Ahmedabad Electricity Co. Ltd.
— 2003 (158) E.L.T. 3 (S.C.) — Relied on .............................................................................. [Paras 4.1, 6]
Union of India v. Hindustan Zinc Ltd. — 2014 (303) E.L.T. 321 (S.C.) — Relied on ................ [Paras 4.1, 6]
REPRESENTED BY : Shri M.S. Nagaraja, Advocate, for the Appellant.
Smt. C.V. Savitha, Superintendent (AR), for the
Respondent.
[Order]. - The present appeal is directed against the impugned order
dated 14-3-2019 passed by the Commissioner (Appeals) whereby the Commis-
sioner (Appeals) has rejected the appeal of the appellant.
2. Briefly, the facts of the case are that the appellants are manufacturers
of sponge iron and MS billets falling under Chapter Headings 7203 10 00 & 7205
10 90 of the CETA, 1985 and are availing the Cenvat credit under the CCR, 2004.
A show cause notice dated 5-12-2017 was issued to the appellant demanding
amount equal to 6% of the sale of electricity sold for the period from November,
2015 to March, 2016. It was alleged that the appellant have used common in-
put/services for manufacture of electricity which is an exempted product. Fur-
ther, the appellants have failed to maintain separate accounts as provided under
Rule 6 of CCR, 2004 and accordingly liable to pay amount equal to 6% of the val-
ue of electricity sold outside the factory. After following the due process, the
original authority has confirmed the demand of Rs. 41,35,743/- being 6% of the
value of electricity sold to GESCOM during the relevant period in terms of Rule
6(3)(i) read with Section 11A(1)(a) and also imposed penalty of Rs. 4,13,574/-.
Aggrieved by the said order, appellant filed appeal before the Commissioner
(Appeals) who rejected the appeal. Hence the present appeal.
3. Heard both sides and perused records.
4.1 Learned Counsel for the appellant submitted that the impugned or-
der is not sustainable as the same has been passed without properly appreciating
the facts and the law. He further submitted that the appellants have not taken
Cenvat credit on inputs used in the generation of electricity. He further submit-
ted that it is settled law that electricity is goods but not excisable goods and the
ground made out in the show cause notice and confirmed in the impugned order
are not correct. He further submitted that in the appellant’s own case for the ear-
lier period, this Tribunal vide Final Order No. 21815-21818/2018, dated 29-11-
2018 has held that electricity though listed in the Tariff, is not excisable goods.
He further submitted that the Iron ore, Dolomite, coal etc. are charged in the Ro-
tary Kiln for melting and production of Iron. The coal is burnt in the Kiln for
melting the charge. In the process, Sponge iron is produced as final product.
Char dust/Dolochar, being coal ash and partially burnt coal, remains as residual
waste in the Kiln. The waste heat from the Kiln which would have escaped or
GST LAW TIMES  2nd July 2020  133