Customs, Excise and Gold Tribunal - Mumbai
Commissioner Of Central Excise vs Kalyani Seamless Tubes Ltd. on 27 August, 2004
Equivalent citations: 2004(176)ELT899(TRI-MUMBAI)
ORDER S.S. Sekhon, Member (T)
1. After hearing both sides & considering the issues it is found-
a) Revenue is in appeal against the respondents an assessee be denied on storage tanks based on eligibility and on filing of declaration.
b) Commissioner granted the credit as nitrogen was exclusively captively consumed & not marketed outside & the description given broadly covered most of the goods alleged to be not declared. He held eligibility could not be denied as goods were received and installed & he condoned the absence of pre printed serial number on invoices on grounds of error. The assessee was imposed a penalty of Rs. 1000/- only for the violation.
c) Revenue is aggrieved by the order, on the grounds-
i) Nitrogen is not intermediate product, is excisable at nil rate of duty, on its own & grant of credit to plant manufacturing that gas was not permissible. This was so as the lease agreement was not with a Financial Company as per Rule 57R(3).
ii) Storage tank's under Rule 57Q was not as specifying heading. Therefore grant of credit on the same not called.
iii) Declaration were mandatory & details were required & Sr.No pre-deposit printed was a requirement of law.
d) Commissioner after an analysis of the process of manufacture adopted concluded that nitrogen gas was vital input in the manufacture of pipes & without use of nitrogen the pipes would not be possible to be manufactured. Once assessee has adopted for a process of manufacture, where nitrogen gas is essential, they would be eligible to credit of capital goods which produce such nitrogen. We find ho reason to deny the credit on the reason as found by the Commissioner, to the plant manufacturing an essential consumable required in the manufacturers of the final product. As regards the grounds, taken about lease agreement; the Commissioner has found that such an agreement was produced & seen by him, was found that leasing company had not claimed depreciation under Income Tax Law, thus he overruled the objection on that aspect. However for non production of lease agreement earlier he imposed a penalty liability under Rule 173Q. Reading of Rule 57R(3) it is found that the stipulation therein would apply, if goods are on lease from a 'finance company'. That rule cannot be interpreted to mean, that no 'lease' could be had of 'capital goods' from other than a "Finance Company". We find no merits in the ground taken by revenue credit on nitrogen plant as capital goods is eligible.
e) As regards storage tank eligibility, it is part & component of the plant to store nitrogen gas. Storage tanks are eligible capital goods & Commissioner has correctly granted the credit as components essential to the nitrogen gas plant. Revenue is not contesting that aspect. Credit is therefore held eligible.
f) On procedural aspects, the credit cannot be denied only penalty could be imposed. Commissioner has imposed a penalty of Rs. 1000/-. We find that to be sufficient & uphold the Commissioner findings on credit eligibility, on documents & on grounds of general description intimation having been filed.
2. No merits are found in the appeal of revenue, the same is required to be dismissed.
3. Ordered accordingly.
(Pronounced in Court 27/08/2004)