Page 134 - GSTL_2nd July 2020 _Vol 38_Part 1

52 GST LAW TIMES [ Vol. 38
dissipated is passed through Waste Heat Recovery Boiler for generation of
steam. The waste heat is thus used for generation of steam. The char dust, coal
ash or dolochar, the residual waste, is fed in the Atmospheric Fluidised Bed
Combustion Boiler to produce steam. The steam generated by using waste heat
and coal ash/char dust in the boilers is used for generation of electricity, which is
partly captively consumed within the factory for manufacture of final products
and excess electricity is sold to GESCOM. He also submitted that they have not
availed credit on any common input used for manufacture of dutiable final
product and exempted final product and the show cause notice as well as the
impugned order have not furnished the details of the inputs on which credit was
taken and were used for generation of electricity. He further argued that it is a
settled law that burning of coal in the boiler or kiln and generation of coal ash or
residual waste coal is not a process of manufacture of coal ash or char. This issue
stands settled by the judgment of the Hon’ble Apex Court in the case of UOI v.
Ahmedabad Electricity Co. [2003 (158) E.L.T. 3 (S.C.)]. He further submitted that the
provision of Rule 6 of CCR, 2004 are not applicable to waste products generated
in the course of manufacture of dutiable final products. In the present case, heat,
not goods, and char, a waste, are used in the boiler for generation of steam,
which is used for generation of electricity and such use of waste products does
not attract the provisions of Rule 6 of the CCR, 2004. For this submission, he re-
lied upon the following decisions :-
(i) UOI v. Hindustan Zinc Ltd. [2014 (303) E.L.T. 321 (S.C.)]
(ii) CCE, Allahabad v. Hi-Tech Carbon [2018 (17) G.S.T.L. 398 (All.)]
(iii) Rallis India v. UOI [2009 (233) E.L.T. 301 (Bom.)]
4.2 He further submitted that the impugned order has proceeded on
the same premise that the electricity classified under CETH 2716 00 00 attracts
NIL rate of duty and hence exempted goods which is contrary to the settled legal
position. He also submitted that vide Notification No. 13/2016-C.E. (N.T.), dated
1-3-2016 has introduced Rule 6(3AA) in the CCR, 2004 w.e.f. 1-4-2016 and the
appellant, by making use of this clause, has paid the amount of Rs. 11,23,096/-
vide Challan No. 00142, dated 10-7-2018 along with applicable interest of Rs.
4,86,007/- vide Challan No. 00081, dated 30-7-2018. He further submitted that
both the authorities have ignored the Rule 6(3AA) which was on the statute from
1-4-2016 whereas the show cause notice was issued on 5-12-2017 demanding an
amount equal to 6% of the value of electricity.
5. On the other hand, the Learned AR defended the impugned order
and submitted that the appellants have suppressed the material fact from the
Department and on verification by the Department, it was revealed that the ap-
pellant is also selling the electricity to GESCOM. She further submitted that after
the amendment in the definition of exempted goods w.e.f. 1-3-2015, exempted
goods means excisable goods which are exempted from whole of the value of the
excise duty leviable thereon and includes goods which are chargeable to NIL rate
of duty. She further submitted that payment of proportionate credit of input ser-
vices attributable to the value of electricity sold during the relevant period was
made after the issuance of the show cause notice and the Order-in-Original. She
also relied upon the decision of the Tribunal in the case of CC, CE & ST, Tirupati
v. Sri Sai Sindhu Industries Ltd. [2017 (49) S.T.R. 84 (Tri. - Hyd.)].
6. After considering the submissions of both sides and perusal of the
material on record, I find that in the appellant’s own case for the earlier period,

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