Custom, Excise & Service Tax Tribunal
M/S. Maharashtra Seamless Ltd vs Commissioner Of Central Excise, Raigad on 17 October, 2014
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No.
E/707 & 891/11
- Mum
(Arising out Order-in-Appeal No. YDB/446 & 149/RGD/2011 dated 02.05.2011/21.02.2011 passed by the Commissioner of Central Excise (Appeals), Mumbai II)
For approval and signature:
Honble Mr. Ashok Jindal, Member (Judicial)
1. Whether Press Reporters may be allowed to see No
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 Yes CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
M/s. Maharashtra Seamless Ltd.
Appellant
Vs.
Commissioner of Central Excise, Raigad
Respondent
Appearance:
Ms. Padmavati Patil, Advocate for the appellant Shri A. Nath, (AR) for the respondent CORAM:
Honble Mr. Ashok Jindal, Member (Judicial) Date of hearing : 17-10-2014 Date of decision : 17-10-2014 O R D E R No:..
Input service credit on welding electrodes which was used by the appellant for repair and maintenance of the machinery and plant was denied by the lower authorities on the premises that same does not have any nexus for manufacturing of the final product as per Rule 2A of the CENVAT Credit Rules, 2004. The counsel for the appellant relies on Samruddhi Cement Ltd. 2013 (297) ELT 562 (T) and submits that the facts of the said case are squarely covers the case of the appellant. Therefore, they be allowed to take Cenvat credit on welding electrodes.
2. On the other hand, ld. AR relied on the decision of Sree Rayalseema Hi-Strength Hypo Ltd. 2012 (278) ELT 167 (AP) and submits that the Hon'ble High Court has denied the Cenvat credit on welding electrodes which has been used for repair and machinery of plant and machinery.
3. Heard both sides. Considered the submissions.
4. In the case of Samruddhi Cement Ltd. (supra) this Tribunal has considered the decisions of various Hon'ble High Court namely Ambuja Cements Ltd. 2010 (256) ELT 690, Alfred Herbert (I) Ltd. 2010 (257) ELT 29 (Kar), Hindustan Zinc Ltd. 2008 (228) ELT 517 (Raj) and Sree Rayalseema Hi-Strength Hypo Ltd. (supra) and after considering all the decisions, this Tribunal has observed as under:-
5. I have carefully considered the submissions and perused the records. Though there is a recent judgment of the Hon'ble Andhra Pradesh High Court in the case of Sree Rayalseema Hi-Strength Hypo Ltd. v. CCE & C.Tirupati, wherein contrary view has been taken but Honble High Court of Chhattisgarh, Honble Karnataka High Court and Honble Rajasthan High Court have held that welding electrodes used for repairs and maintenance of plant and machinery would be eligible for Cenvat credit. Moreover, the definition of input as given in Rule 2(k) of Cenvat Credit Rules, 2004 covers the goods used in or in relation to manufacture of final products, whether directly or indirectly which is a much wider than the expression used in manufacture. While repair or maintenance by itself is not a process of manufacture, this activity certainly has nexus with manufacture of final product and would be covered by the expression used in or in relation to manufacture of final product as no manufacturing activity is possible with malfunctioning machinery. In view of this, I am of the view that the impugned order is not sustainable. The same is set aside and the appeal is allowed. As observed by the Tribunal, I hold that the appellant is entitled to take Cenvat credit on welding electrodes which have been used for repairs and maintenance and plant and machinery.
5. In these terms, impugned orders are set aside. The Appeals are allowed with consequential relief.
(Dictated in Court) (Ashok Jindal) Member (Judicial) //SR 3