In Brief
The Supreme Court addressed whether electricity used in captive generation for manufacturing cement and caustic soda could be treated as an excisable item subject to CENVAT rules. The Court held that electricity is not an excisable item and therefore cannot be subject to excise duties when captively consumed in manufacturing. The Court further clarified that inputs falling under Rule 6(1) of the CENVAT Credit Rules cannot simultaneously fall within the exception in Rule 6(2). The appeal was allowed, setting aside the lower orders.
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