Custom, Excise & Service Tax Tribunal
C.C.E. Raipur vs M/S. Hare Krishna Sponge Iron (P) Ltd on 20 August, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. IV
Excise Appeal No. E/565/2009-[SM]
[Arising out of Order-In-Appeal No. 04/RPR-1/09 dated: 30.01.2009 passed by CCE (Appeals) Raipur]
For approval and signature:
Hon'ble Mr. S.K. Mohanty, Member (Judicial)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
C.C.E. Raipur ...Appellant
Vs.
M/s. Hare Krishna Sponge Iron (P) Ltd. Respondent
Appearance:
Mr. R K Gupta, DR for the Respondent Mr. H V Ghirnikar, (Advocate) for the Appellant CORAM:
Hon'ble Mr. S.K. Mohanty, Member (Judicial) Date of Hearing/ Decision. 20.08.2015 Final Order No. 54288 /2015_ Per S K Mohanty:
Revenue is in appeal against the impugned order dated 30.01.2009 passed by the Commissioner (Appeals), Central Excise and Customs, Raipur, wherein cenvat credit on the goods namely, Angles, C.T.D. Bars, Flats, Channel, Beams, Joists, Plates, Paints, Electrodes etc. has been allowed in favour of the Respondent herein on the ground that the said disputed goods are confirming to the definition of capital goods for the purpose of taking cenvat credit. The grievance of Revenue is that the disputed goods, by nature of their use cannot be considered as capital goods, because those goods were used for construction/ fabrication of permanent supportive structures in the factory of the respondent.
3. I have heard the Ld. Counsel for both the sides and perused the records.
4. I find that in support of extending the benefit of cenvat credit on the disputed goods, the Ld. Commissioner (Appeals) has recorded the following findings in the impugned order:
13. However, from the nature of the goods and their contribution to the various processes leading to the manufacture of Sponge Iron, I find such capital goods or components/ accessories of capital goods are a part and parcel of the plant. Plants are combinations of a large number of machineries, which are interconnected, and act in unison. Big plants have different varieties of machineries, incidental or ancillary implements, which contribute to the productive process, which individually find mention at different places in the Tariff. Then there are networks of pipes and tubes for movement/ storage of various materials for use in the process of production. The impugned After Burning Chamber Kiln Inlet/ Kiln to cooler Transfer Bin/ Kiln Maintenance Platform/ Cooler Discharge House/Stock House/ Ground Hopper/ Transfer House/ Intermediate Bin/ Conveyor System/ Cable Tranch are in the nature of capital goods fabricated for use within the factory premises, are in the larger context, in the nature of capital goods facilitating the production of Sponge Iron and are to be construed as capital goods of plant/ machineries with which they work. Even in the narrower sense, they are component / parts to the machineries helping in their own ways in the manufacture of excisable goods.
16. I have also examined the allegation incorporated at Para 11 of the impugned show cause notice that Oxygen Gas and Welding Electrodes can neither be considered as inputs used in the manufacture of final products nor can the said goods be considered as inputs used in the manufacture of Capital Goods; that the said goods are used for repair and maintenance purpose; hence Cenvat Credit availed on those items are also not admissible. In this connection, I find there is no evidence on record to suggest the Appellant had used Oxygen Gas and Welding Electrodes for repairs and maintenance. In fact, the Honble Tribunal, in a recent decision in the case of Lloyds Metals and Engineering Ltd. vs Commissioner of Central Excise & Customs, Nagpur reported in 2008 (225) ELT 0222 (Tri. Mum) have held Cenvat/Modvat Welding electrodes used for repairs and maintenance of plant and machinery is assessees steel factory eligible to Cenvat Credit Rule 3 of Cenvat Credit Rules, 2004. In another decision in the case of Bhushan Steel and Strips Ltd. vs CCE, Raigad reported in 2008 (223) ELT 0517 (Tri. Mumbai), it has been held Cenvat/Modvat Capital goods Welding electrodes, wires etc. Used in making of machine plant etc. HELD : use was for producing/ processing capital goods, hence they were eligible for credit Rule 2(b) and Explanation 2 to Rule 2(g) of Cenvat Credit Rules, 2002 Rule 2(a) of Cenvat Credit Rules, 2004. As the appellant have used Oxygen Gas and Welding Electrodes for manufacture of Capital Goods within their factory premises, the ratio of the decision in the case of Bhushan Steels and Strips Ltd. (cited supra) would be squarely applicable to the facts of the present case. Thus, following the ratio of these decision, the Cenvat Credit availed by the Appellant on Oxygen Gas and Welding Electrodes used during the course of fabrication of aforesaid structural items to support the Plant & Machinery would be admissible.
5. In view of the fact that the Commissioner (Appeals) has recorded the specific findings in allowing the cenvat benefit to the Respondent herein, I am of the considered view that there is no infirmity in the impugned order, and thus, the appeal filed by the Revenue is dismissed.
(Dictated and pronounced in open court) (S. K. Mohanty) Member(Judicial) Neha 3 | Page E/565/2009-Ex[SM]