Customs, Excise and Gold Tribunal - Delhi
L.H. Sugar Factories Ltd. vs Commissioner Of Central Excise on 16 June, 2005
Equivalent citations: 2005(189)ELT85(TRI-DEL)
ORDER P.S. Bajaj, Member (J)
1. This order will dispose of the above captioned two appeals directed against the common order-in-appeal. Appeal No. E/3231/03-NB(S) has been filed by the assessee vide which he has challenged the correctness of the part of the impugned order disallowing the Modvat credit on the M.S. Plates, while in the second appeal No. E/3180/03-NB(S), the Revenue has disputed the correctness of the impugned order allowing the credit to the assessee on Asbestos-Yarn- Packing and CF-Structures.
2. I have heard both sides and gone through the record. From the record, it is evident that the assessee is engaged in the manufacture of sugar. On M.S. Plates, the Modvat credit has been disallowed on the ground that these are not covered by the definition of 'Capital Goods', but the view taken by the Commissioner (Appeals) in this regard cannot be sustained as these plates are being used for the maintenance of the machines and machinery parts. Therefore, in view of this, the assessee is entitled to the Modvat credit on the plates. Their case also stands covered by the ratio of the law laid down in the case of Perambalur Sugar Mills Ltd. v. CCE, Tricky, 2004 (64) RLT 69, wherein credit on M.S. Plates in an identical case had been allowed by the Tribunal and also Global Sugar Ltd. v. CCE, Kanpur, 2000 (119) E.L.T. 611, wherein also on these goods, the credit has been held to be admissible. The Tribunal's judgment in the case of Global Sugar Ltd. v. CCE, Kanpur, supra, even stands upheld by the Apex Court while dismissing the appeal of the Revenue against that order [2001 (132) E.L.T. 3 (S.C.)]. Therefore, the impugned order of the Commissioner (Appeals) disallowing the Modvat credit on MS Plates, cannot be sustained and is set aside.
3. Regarding the availability of the Modvat credit on Asbestos Yarn Packing, and CF Structures, which has been disputed by the Revenue in their appeal, in my view, the impugned order is well founded and needs no interference. In the case of KCP Sugar & Indus. Ltd. v. CCE, Guntur, 2004 (62) RLT 764, asbestos packing had been held to be eligible capital goods for the Modvat credit. Therefore, the case of the assessee stands fully covered by this judgment and the Commissioner (Appeals) has thus rightly allowed the credit on these goods.
4. On CF structures, the Commissioner (Appeals), in my view, has rightly allowed the credit keeping in view its use in the factory. Moreover, on the boiling structure, the credit was allowed to the assessee by the adjudicating authority and that order was not even questioned by the Revenue in appeal before the Commissioner (Appeals) and the same has become final. When on that structure, the credit had been allowed and accepted by the Revenue, the Revenue has no legal ground to dispute the allowance of the credit on the C.F structure. The order of the Commissioner (Appeals) allowing the Modvat credit on both the above referred items, finds corroboration from the ratio of the law laid down in the case of Global Sugar Ltd. v. CCE, Kanpur, supra, which, as observed above, had been upheld by the Apex Court. The ratio of the law laid down in the case of Rosa Sugar Works v. CCE, Kanpur, 1999 (114) E.L.T. 950, referred to by the learned SDR, is not attracted to the facts of the present case, as the user of the items involved therein, in the factory, as capital goods, was not approved by the assessee. The argument of the learned SDR that in the above referred cases relied upon by the counsel, the issue regarding the capital goods was examined in the light of the amended definition of the 'capital goods' and as such has no application, is wholly misconceived. There has been no material or substantial change in the definition of the 'capital goods' before or after the amendment in respect of the components, parts, spares and machinery. Therefore, the impugned order allowing the Modvat credit to the assessee on the above said items, is upheld.
5. In view of the discussion made above, the appeal of the assessee bearing no. E/3231 /03-NB(S) is allowed in toto, while the appeal of the Revenue bearing no. E/3180/03-NB(S) is dismissed.
(Dictated & pronounced in the open Court)