UNION OF INDIA vs M/S HINDUSTAN ZINC LTD.

The Supreme Court addressed the entitlement of assessees to Modvat/Cenvat Credit for inputs used in manufacturing exempted products under Rule 57CC of the Central Excise Rules, 1944, and Rule 6 of the Cenvat Credit Rules, 2004. The Court held that the assessees are liable to pay excise duty on by-products like sulphuric acid when cleared under exemption, emphasizing the necessity of maintaining separate accounts for dutiable and exempted goods. The appeals were decided in favor of the Revenue, affirming the requirement for compliance with the statutory provisions regarding excise duty.