Customs, Excise and Gold Tribunal - Delhi
Sukhmal Steel And Metal Industries Ltd. vs Collector Of C. Ex. on 1 June, 1999
Equivalent citations: 1999(113)ELT181(TRI-DEL)
ORDER Jyoti Balasundaram, Member (J)
1. In this case Modvat credit of Rs. 3,31,400/- has been denied on the following items, on the ground that they are not capital goods within the meaning assigned thereto in Explanation l(a) to Rule 57Q of the Central Excise Rules, 1944. The period in dispute is December, 1994 to February, 1995.
1. Water cooled capacitors (8532)
2. Induction coil/magnetic yoke (8548)
3. DC choke (8548)
4. Assembly wiring of testing of 1500 KW Inner from cubide (8537)
5. Auxiliary control panel (8537)
6. Double break isolator (8535)
7. Cooling channel (8485)
8. Water cooled cables (8544)
9. HV switchgear/circuit breaker (8535)
2. I have heard Shri J.S. Agarwal, learned Advocate who submits that credit is available on the above items in the light of the Larger Bench decision in the case of Jawahar Mills Ltd. and Ors. reported in 1999 (108) E.L.T. 47, and Shri Arunachalam, learned DR who submits that the items are in the nature of components/parts of induction furnace, but not covered by Clause 19(b) of the Explanation clause to Rule 57Q.
3. I find that the Assistant Collector has recorded a categoric finding that the items in dispute are all electrical goods or electronic goods used for transmission, distribution and control of electricity or for making or breaking circuits and for monitoring the performance parameters of the system. Credit has been denied on the ground that these goods by themselves cannot be used for bringing about any change in any substance or for producing or processing the goods for the manufacture of final products. However, the Larger Bench of the Tribunal has held that control panels, transformers which transmit and control electricity are capital goods within the meaning of Rule 57Q of the Central Excise Rules, 1944. The Larger Bench has not followed the decision of the Tribunal in the case of J.K. Pharmachem v. Collector of Central Excise, Tricky reported in 1997 (21) RLT 868, which has been relied upon in the impugned order.
4. Following the decision of the Larger Bench cited supra, I hold that the items in dispute are capital goods under Rule 57Q, and entitled to Modvat credit, set aside the impugned order and allow the appeal.