Customs, Excise and Gold Tribunal - Tamil Nadu
M/S. Hindustan Sanitaryware ... vs Commissioner Of C.Ex., Hyderabad on 24 July, 2001
ORDER Shri S.L. Peeran, Member (J)
1. This appeal arises from Order-in-Appeal No. 365/96-CE dated 17.9.96 by which the Commissioner (Appeals) has disallowed capital goods credit on C.I. casting and iron & steel channels and boards while he has granted benefit on other items on which there is no Revenue appeal before us today.
2. Appellants are aggrieved for non-grant of Modvat credit on CI casting and Iron & Steel used for manufacturing supporting frame to furnace.
3. The Commissioner has noted that they do not come within the definition of 'capital goods' under rule 57Q as machines, machinery, plant, equipment apparatus, tools or appliance used for producing the final goods are not capital goods. With regard to CI casting, he has held that they are used in the manufacture of moulds which are not the final products and therefore, CI castings are not eligible for capital credit. With regard to Iron & steel he has held that they are raw materials used in the manufacture of support frame which is not a declared final product.
4. Ld. Consultant Shri C. Chidananda Rao submits that both the items are primary, necessary and essential for manufacture of final products without the same being used final product cannot come into existence. The Tribunal had an occasion to deal with this very item and have already taken a decision that CI casting used for moulds which are used for final products, are required to be granted modvat credit as capital goods as rendered in the case of VISVESVARAYA IRON & STEEL - 2000 (125) ELT 1171 (T). With regard to Iron & Steel, used for structures to manufacture furnace. Ld. Counsel relies on the following judgments:-
1. CCE Vs. J.K. CEMENT WORKS
-2000 (36) RLT 451
2. NEW J.K. CEMENTS Vs CCE
- 1999 (113) ELT 428 (T)
3. GLOBAL SUGARS LTD Vs CCE
- 2000 (119) ELT 611 (T) He submits that in all the three judgments cited the Tribunal gone in great detail as to how the iron and steel are in form of plates, channels, M.S. angles etc used for making steel structure would be eligible for modvat credit and the Revenue appeals were dismissed after looking into several other like judgement of the Tribunal as in the case of CCE Jaipur Vs J.K. CEMENT WORKS - 2000 (36) ELT 451. Reference is also made to the judgement of NEW J.K. CEMENT WORKS Vs CCE (supra) wherein supporting structures of steel, power pack voltage relay and choke cables used in the manufacture of clinkers and cement were held to be capital goods. The Counsel submits that the case of New J.K. Cement Works has been appealed by the Revenue before the Apex Court but there is no stay and he has referred to page A83 of 2000 ELT 1st July issue. He submits that in the case of GLOBAL SUGAR LTD Vs CCE Kanpur (supra), the Tribunal again upheld the contention that M.S. angles, MS channels and steel structures used for boiling house are essential for manufacture of the final product and applying the ratio of larger bench judgement of JAWAHARMILLS -1999 (108) ELT 47 granted relief. He submits that the same ratio is required to be follows.
5. Ld. SDR, on the other hand, submits that Revenue has not accepted these judgement and matter is pending before the Apex Court as brought out by the Ld. Counsel himself. The Jawahar Mills case which is a Larger Bench judgement has also been appealed before the Apex Court. He submits that it will be in the interest of justice if the matter is kept pending till the Apex Court decides the matter.
6. On a careful consideration of the submissions, we are not agreeable to the submission of Ld. SDR to keep the matter pending as there is no stay and all the Benches of the Tribunal are applying the ratio of these judgements and disposing of the appeals. We notice that both the items on which modvat credit has been claimed, are covered by the ratio of the judgement cited by the Counsel which are already extracted above. Same are squarely applicable to the facts of the case and there is no necessity to take a contra view. In terms of judicial discipline the ratio is required to be applied. In that view of the matter, following the ratio of the judgements cited, the impugned order rejecting claim of modvat credit on the two items is set aside. Appeal is allowed with consequential relief, if any, as per law.
(dictated and pronounced in open court)