Customs, Excise and Gold Tribunal - Tamil Nadu
Cce Hyderabad vs Vishnu Chemicals P. Ltd. on 1 January, 1800
ORDER
Shri Jeet Ram Kait
1. In all these appeals the issue being common with regard to eligibility of modvat credit on the following items, same are taken up together for disposal as per law:-
(1) Wires & Cables (2) Weighing Machines (3) Refractory Material (4) Lubricant oil (5) Control Panel Boards (6) Static convertors & parts (7) High Tension Switch Boards (8) Sitor fan assembly (9) Capacitors (10) Fuses, panels and load brakers (11) Voltage Stabilizer (12) HDPE Pipes, MCC (Control) Panels, Tyres, forklifts (13) 3D co-ordinate measuring machine.
2. We have heard Ld. SDR appearing in all these appeals including two matters wherein they have asked for stay of the operation of the impugned order. As the issue is covered, the stay application is rejected and main appeal itself taken up in respect of Vishnu Chemicals Pvt. Ltd.
3. Ld. SDR fairly submits that the issue is covered against Revenue in terms of larger bench judgement rendered in the case of JAWAHAR MILLS LTD Vs CCE reported in 1999 (108) ELT 47 and that of another Larger Bench judgement of CCE Indore Vs SURYA ROSHNI LTD. reported in 2001 (128) ELT 293 and the reference filed by a party before the High Court of Madras in SIV Industries Ltd Vs CCE reported in 2001 (129) ELT 48 (Mad.-Division Bench) has also been rejected. However, he submits that the Apex Court has admitted the grant of modvat credit on wires & cables with regard to judgement passed by the Larger Bench in the case of JAWAHAR MILLS LTD and therefore he submits that appeal could be kept pending to await the Larger Bench judgement. As large number of Advocates, and also Consultants whose names are already named above, contended that there is no stay of the operation of the Larger Bench judgements and as a Co-ordinate Bench, the Tribunal has to follow the Larger Bench judgement in JAWAHAR MILLS LTD & SURYA ROSHNI LTD. Therefore, they oppose the prayer for keeping these appeals pending endlessly till the Apex Court decides the matter. It was further submitted that this Bench comes directly under the jurisdiction of Madras High Court and the Division Bench in the case of SIV Industries (supra) has upheld the grant of modvat credit on Electrical Wires & Cables and therefore they seek for a final order in the matter.
4. It was also brought to our notice that in similar appeals, the following items are involved and the issue of eligibility of modvat credit on these items is covered by the judgements cited below. Ld. Consultant Shri Chidananda Rao appearing for M/s. KCP ltd., in E/2546/98 contends that the items involved in their case are covered by the Tribunal judgements and files a chart of items involved and citations covered which are noted herein below:-
S.No. Description of capital By decisions of Hon'ble CEGAT Goods on which Comm.(A) bearing upon the eligibility of credit Disallowed the credit.
1. Whytheat C & LC-8 CENTURY CEMENTS Vs CCE (Refractory material) RAIPUR-1997 (95) ELT 655 (T)
2. Lubricants used for Appellants' own case final order Lubrication No. 1567/99 dt 28/6/99 of SZB.
3. Welding Electrodes used for JAWAHAR MILLS LTD Vs CCE welding purpose CBE-1999 (108) ELT 47 (T-LB)
4. Tachno Generator CCE Chandigarh Vs RANO (Speed indicator) MAHENDRA PAPERS LTD 1999 (35) RLT 499-CEGAT.
5. Acetylene Gas Appellants' own case vide Final (used for cutting purpose) Order No. 289-291/01, dt 16.2.01 of SRB.
6. Rough Steel Castings 1. CENTURY CEMENTS Ltd. Vs (used to protect kiln and Cement CCE RAIPUR-1997 (95) ELT Mill from heating) 655(T)
2. VISVESVARAYA IRON & STEEL Vs CCE Belgaum 2000 (125) ELT 1171.
7. Tega Special Resistant To prevent outer air to enter the Rubber Inner machines.
8. Rubber cord Used to Hydraulic Lining.
5. It was also pointed out that even the weighing machines used in weighing raw materials and products are being considered as essential for manufacture of final products including chilled water being used in Air Handling Unit for bringing down the temperature in coating room have been held to be falling within the definition of capital goods, as held in the case of CCE Meerut Vs MODI XEROX LTD. 1997 (90) ELT 214(T). Therefore, the Consultant Shri S. Kandaswamy, appearing in the case of CCE Vs Satyam Spinning Mills (P) Ltd. seeks for application of this judgement to this case also and submits that the Ld. Commissioner has rightly followed the ratio of the judgements and orders passed by the Commissioner in all the appeals are in terms of large number of Tribunal's judgement which are noted in each of the order and there is no infirmity in the same. Ld. Consultant Shri Kandaswamy also contends that besides weighing machines, the items humidification plant & compressed air dryer are also involved in their matter of Satyam Spinning Mills (P) Ltd. which is also covered by all the judgements rendered in the case of CCE Vs SSPE COTTON MILLS (P) LTD., as reported in 1999 (106) ELT 102 and the item air dryer is covered by the judgement of MANSURPUR SUGAR MILLS Vs CCE - 1999 (114) ELT 1038(T).
6. One Shri M.R. Diwakar, representative appearing for M/s. Tube Products of India also contends that the Commissioner has rightly followed the Tribunal judgement by granting relief with regard to items High Tension Switch Board, parts of static convertor, Sitor Fan assembly and static convertor and control panels. He submits that the items involved in their case are covered by the Larger Bench judgement. He also submits that there is one input involved in their appeal which is superior kerosene oil used in annealing furnace which is held as eligible for modvat credit in their own case by this Bench in CCE Madras Vs TUBE PRODUCTS OF INDIA by final order No. 2362 of 2364/97 dated 1.8.97. Therefore, the Commissioner has rightly followed these judgements. Hence, he seeks for confirmation of the order impugned.
7. Shri J. Shankaraman, Shri V. Balasubramanian, Shri K.R. Natarajan, assisted by Ravikumar Sh. M.V. Raman, Ms. Prameela Viswanathan, Ld. Advocates and Shri Masilomoney, Ld. Consultant and also Shri. G. Gopinathan, representative for M/s. Samayapuram Vel Industries, appeared in other cases and contend that the items involved in their cases pertain to Electric Cables & Wires are all covered by the Larger Bench judgement and the Commissioner has rightly followed the ratio of the judgements. Ld. Consultant Shri Masilomoney submits that the item water treatment plant is also involved in their appeal and relief has been given on the said item also. The Ld. Counsel and Consultants contend that as the issue is no longer res integra, therefore, the appeal of the Revenue could be rejected in the light of the judgements cited.
8. On a careful consideration of the submissions, we are not inclined to adjourn the matter as prayed by Ld. SDR to await judgement of the Apex Court for the simple reason that Hon'ble Apex Court has not granted stay of operation of the judgement of two Larger Bench judgements rendered in the case of JAWAHAR MILLS LTD & SURYA ROSHNI MILLS LTD. Besides, we notice that this Bench falls within the jurisdiction of High Court of Judicature at Madras and the Hon'ble High Court in SIV Industries Ltd., (supra) has already upheld the grant of modvat credit in respect of Electrical Wires & Cables. We are bound by the judgement of Larger Bench of the Tribunal and that of High Court judgement. Hence, question of adjourning and awaiting Apex Court Judgement does not arise. Hence, we take up the appeals for final disposal.
9. We observe that the aspect pertaining to Wires & Cables are covered by the judgement of Larger Bench and the judgement of Madras High Court cited supra, and hence applying the ratio, all revenue appeals arising on this issue are dismissed.
10. As regards the items involved in the case of KCP Ltd., the chart and judgements covered is already extracted above. There are no contra judgements and there is no need to take a different view and hence following the ratio of all the judgements already extracted in the chart, the appeal filed by appellant M/s. KCP Limited is allowed by setting aside the order of the Commissioner.
11. As regards the appeal of Revenue against M/s. Tube Products of India, we have gone through the judgements cited by the representative and also the Commissioner's order and find that the Commissioner has rightly followed the ratio of judgements cited therein and there is no infirmity in the order and hence while confirming the same, we dismiss appeals.
12. As regards the appeal of Revenue against M/s. MM Forgings Ltd., we note that the items involved are Servo Regulator, Voltage Stabilizer, Isolation Transformer used to maintain power supply at the required voltage to the plant and machinery and the Commissioner after noting the Larger Bench judgement has granted the benefit. We notice that the Commissioner has rightly followed the judgement in allowing the credit in respect of these items. Hence, we confirm the order by rejecting the appeal.
13. In respect of M/s. Satyam Spinning Mills, the items involved are weighing machines, humidification plant, Electrical wires & cables, air dryer. We have already noted the judgements which cover the issue, including the Larger Bench judgement and the Commissioner has given a finding that they are used in or in relation to the manufacture of the final product. Therefore, there is no infirmity in the order and the Revenue appeal in respect of Satyam Spinning Mills is rejected.
14. In the case of Arun Smelters (P) Ltd., the items involved are oil coil and XLPE cable, Circuit Breaker, fuse panel load breaker and 10 MT cranes. The Commissioner has followed the ration of his earlier orders and applied to this case. Hence the issue being fully covered by larger bench judgement, there is no need to take different view and hence the order is confirmed by rejecting the Revenue appeal.
15. In the case of Trichy Steel Rolling Mills Ltd., the item in question are thyrester, rectified thyrester, capacitor, fuse, which have been held to be parts and accessories of the electrical panel board for regulating the power supply to the induction furnace for the production of final product. The Commissioner has gone through in great detail as to how these items are essential and has followed the judgement of the Tribunal rendered in (a) L & T - 1998 (101) ELT 131 (b) IPITATA SPONG IRON LTD Vs CCE 1998 (104) ELT 339 (c) VIVEK ALLOYS LTD Vs 1998 (98) ELT 156. The order is in terms of the ratio laid down by the Tribunal. There is no contra judgements. Therefore the prayer made by the Counsel Ms. Prameela Viswanathan for confirming the order is accepted and the Revenue appeal in respect of Trichy Steel Rolling Mills Ltd., is rejected.
16. With regard to Electrical Wires & Cables, the Counsels and the representatives pointed out that the issue is covered by the Larger Bench rendered in JAWAHAR MILLS LTD and SURYA ROSHNI LTD supra, and the rejection of reference by the High Court of Madras rendered in SIV Industries Ltd. Hence, respectfully following the ratio already laid down, the appeals of Revenue are rejected by confirming the Commissioner (Appeals) order.
17. In respect of other appeals, it is observed that various items on which grant of credit is claimed by the respondents fall within the definition of capital goods. Hence, ratio laid down by the Tribunal, including the Larger Bench on modvat credit in respect of capital goods applies to these case also. In that view of the matter, the Revenue appeals challenging the grant of modvat credit on these items is rejected by confirming the Commissioner (Appeals) order.
18. In the result, the above noted appeals of Revenue are rejected and the appeal of KCP Ltd., is allowed.
(Pronounced & dictated in open court)