The present study demonstrates a cost-effective process for liquid biofuel production (butanol and ethanol) from non-acetone forming strain C. sporogenes NCIM 2918. The cost-effectiveness was achieved by culturing the organism on cheaper raw materials such as sugar hydrolysate from lignocellulosic biomass and crude glycerol, a waste from the biodiesel industry. Three types of biomass namely rice straw, sugarcane bagasse, and areca nut husk were explored. The maximum amount of glucose was obtained from hydrolysis of rice straw and optimization of enzymatic hydrolysis conditions was carried out for the same. The hydrolysate thus obtained was used to replace pure glucose in dual substrate blend while pure glycerol was replaced with hexane washed crude glycerol. Batch fermentation resulted in a total alcohol titer and productivity of 23.5 g L−1 and 0.52 g L−1 h−1 respectively. An improvement in total alcohol titer (26.4 g L−1) and productivity (0.69 g L−1 h−1) was observed when batch fermentation was coupled with an in situ product recovery via gas stripping. To extend the cultivation period, the mode of fermentation was changed from batch to fed-batch. Fed-batch fermentation, with intermittent feeding of sugar hydrolysate and crude glycerol, coupled with gas stripping resulted in improved total alcohol titer of 44.4 g L−1 (butanol 21.5 g L−1 and ethanol 22.9 g L−1) with a productivity and yield of 0.62 g L−1 h−1 and 0.37 alcohol per gram of sugar (glucose + glycerol) respectively.