Relief for SAIL: CESTAT Holds By-Products Not Liable Under Rule 6 of CCR, Accepts Proportionate Reversal

In a relief for SAIL (Steel Authority of India Limited), CESTAT (Customs, Excise, and Service Tax Appellate Tribunal) held that "by-products are not liable under Rule 6 of CCR (CENVAT Credit Rules)" and accepted "proportionate reversal." The tribunal clarified that Rule 6, which deals with reversal of CENVAT credit on inputs/input services used in both dutiable and exempted goods, does not automatically apply to by-products which are incidental to the main manufacturing process. It allowed SAIL to reverse CENVAT credit proportionately instead of completely, recognizing the incidental nature of by-products.