M/S Maruti Suzuki Ltd vs Commr.Of Central Excise-Iii,Delhi

The Supreme Court addressed the interpretation of 'input' as defined in Rule 2(g) of the CENVAT Credit Rules, 2002, in the context of M/s. Maruti Suzuki Ltd.'s claim for CENVAT credit on naphtha used for electricity generation. The Court held that the appellant is entitled to CENVAT credit for naphtha used in generating electricity, and there is no requirement to reverse proportionate credit for electricity wheeled out to sister units or vendors. The judgment clarifies the applicability of the CENVAT Credit Rules concerning the distribution of electricity generated within the factory.