Custom, Excise & Service Tax Tribunal
M/S. The India Cements Ltd vs Cce, Chennai-Ii on 5 November, 2015
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH AT CHENNAI E/EH/40728/2014 in E/342/2011 E/EH/40729/2014 in E/366/2011 E/EH/40730/2014 in E/367/2011 E/EH/40731/2014 in E/368/2011 (Arising out of Order-in-Original No. 02 05/2011 dated 16.03.2011, passed by the Commissioner of Central Excise Chennai-II). M/s. The India Cements Ltd. : Appellants Vs. CCE, Chennai-II : Respondent
Appearance Shri C. Saravanan, Adv., For the applicant Ms. Indira Sisupal, AC (AR) For the respondent CORAM Honble Shri R. PERIASAMI, Technical Member Honble Shri P.K. CHOUDHARY, Judicial Member FINAL ORDER No. 41522-41525 / 2015 Date of Hearing/Decision: 05.11.2015 Per: R. Periasami, Revenue filed all the four early hearing applications pertaining to all the four appeals, on the ground that the revenue involved in all these appeals is more than One Crore. Since, this Bench has already disposed identical appeal pertaining to the very same appellant vide Final Order No. 41506/2015 dated 03.11.2015. Since the appeals are arising out of a common Order-in-Original, after allowing early hearing applications the appeals are taken up for disposal.
2. The brief facts of the case are that the issue relates to denial of Cenvat Credit on M.S. Angles, M.S. Channels, M.S. Plates, TMT Rods etc. used in the manufacture of cement as capital goods for setting up of the plant. The adjudicating authority confirmed the demand of Rs. 1,72,75,850/- (in all the four appeals) along with interest and imposed penalty under Rule 15 of the Cenvat Credit Rules, 2004.
3. The Ld. Advocate appearing on behalf of the appellants submit that on identical issue, in their own case, this Bench has allowed the appeal.
4. The Ld. AR reiterated the findings of the adjudicating authority and submits that he has rightly denied the Cenvat credit of the capital goods used in the manufacture of cement.
5. After hearing both the sides and on perusal of records we find that the issue relates to denial of cenvat credit on M.S. Angles, M.S. Channels, M.S. Plates, TMT Rods etc. capital goods used in the manufacture of cement. The Honble High Court in the appellants own case in four appeals reported in 2012 (285) ELT 341 (Mad.), 2013 (29) ELT 508 (Mad.), 2014 (310) ELT 636 (Mad.), 2014 (305) ELT (Mad.) and 2015 (323) ELT 209 (Mad.) held in favour of the appellants and set aside Revenue CMAs and allowed the assessees appeals. This Bench by following the decisions of the Honble High Court allowed the appeal in appellants own case vide Final Order No. 41506/2015 dated 3.11.2015. The relevant portion of the said order is reproduced as under:-
5. After hearing the submissions of both sides, we find that the short issue in this case relates to availment of cenvat credit on OPC cement, MS plates, MS beam, MS Angle, MS channels, MS sheets, M.S. Flat, TMT Rod and TOR Rod used for the construction of their "Dry Process Cement Manufacturing Plant". On perusal of records, and the OIO, we find that credit was denied only on the ground that these items were used in the construction plant. Adjudicating authority denied credit on the ground that the term "plant" is not defined as "capital goods" in the CCR. We find that on an identical issue in the same assessee, this Tribunal has already allowed the appeals in respect of appellant's units and the Revenue preferred C.M.As. against the Tribunal's order. The Hon'ble Madras High Court in both the orders dismissed the Revenue's appeals as reported in the case of CCE Trichy Vs India Cements Ltd. 2014 (305) ELT 558 (Mad.), CCE & Service Tax Vs India Cements Ltd. - 2014 (310) ELT 636 (Mad.). The relevant paragraphs of the High Court's order reported in 2014 (305) ELT 558 (Mad.) are reproduced as under:-
"7. Heard learned? Standing Counsel appearing for the Revenue and the learned counsel appearing for the assessee and perused the materials placed before this Court.
8. Even though? Learned Standing counsel appearing for the Revenue submitted that the judgment in the assessees own case reported in AIT-2011-358-HC = 2012 (285) E.L.T. 341 (Mad.) (The Commissioner of Central Excise v. M/s. India Cements Limited) had been appealed against, as of today, there are no details; in any event, the fact, herein is that the Revenue does not controvert the facts found by the Assistant Commissioner that the impugned goods were used for fabrication of structurals to support various machines like crusher, kiln, hoppers, pre-heaters conveyor system, etc. and that without these structurals, the machinery could not be erected and would not function.
9. In the decision? reported in AIT-2011-358-HC = 2012 (285) E.L.T. 341 (Mad.) (The Commissioner of Central Excise v. M/s. India Cements Limited), pointing out to Rule 57Q and the interpretation placed by the Apex Court in the decision reported in 2010 (255) E.L.T. 481 (Commissioner of Central Excise, Jaipur v. Rajasthan Spinning & Weaving Mills Ltd.) and in particular Paragraph Nos. 12 and 13, wherein the Apex Court had applied the user test by following the Jawahar Millss case, this Court, held that steel plates and M.S. Channels used in the fabrication of chimney would fall within the ambit of capital goods. In the face of this decision in the assessees own case there being no new circumstance or decision in favour or the Revenue, we do not find any good ground to take a different view herein too.
10.As far as the? reliance placed by the Revenue on the decision reported in 2011 (270) E.L.T. 465 (S.C.) (Saraswati Sugar Mills v. Commissioner of C. Ex., Delhi-III) is concerned, we do not think that, the said decision would be of any assistance to the Revenue, considering the factual finding by the Tribunal therein in the decided case that the machineries purchased by the assessee were machineries themselves. Thus, after referring to the decision reported in 2010 (255) E.L.T. 481 (Commissioner of Central Excise, Jaipur v. Rajasthan Spinning & Weaving Mills Ltd.), the Apex Court held that in view of the findings rendered by the Tribunal that the machineries were complete and having regard to the meaning of the expression components/parts, with reference to the particular industry in question, the Apex Court rejected the appeal filed by the assessee.
11.Thus going by? the factual finding, which are distinguishable from the facts found by the Authorities below in the case on hand, we have no hesitation in rejecting the Revenues appeal, thereby confirming the order of the Tribunal.
12. Learned Standing Counsel appearing for the Revenue pointed out that, the Tribunal had merely passed a cryptic order by referring to the earlier decisions. We do not think that this would in any manner prejudice the case of the Revenue, given the fact that on the identical set of facts, the assessees own case was considered by this Court and by following the decision reported in 2010 (255) E.L.T. 481 (Commissioner of Central Excise, Jaipur v. Rajasthan Spinning & Weaving Mills Ltd.), the Revenues appeal was also rejected. In the circumstances, this Civil Miscellaneous Appeal is dismissed. No costs. Consequently, C.M.P. No. 16107 of 2005 is also dismissed."
6. Subsequently, the Madras High Court by relying the above order, in a judgement reported in 2014 (310) ELT 636 (Mad.) again dismissed the C.M.A. filed by Revenue and upheld the Tribunal's order. Further, the High Court in a recent decision reported in 2015 (321) ELT 209 (Mad.) on an identical issue allowed the C.M.A. filed by the very same appellant. The relevant portion of this Hon'ble Madras High Court order is reproduced as under :-
"13.?The present appeal is also in respect of the very same assessee and therefore we find no distinguishable fact or issue contrary to the earlier decision of this Court.
14.?It is relevant to note that this Court in the decision reported in 2014-TIOL-1185-H-Mad-CX = 2014 (310) E.L.T. 636 (Mad.) in respect of the very same assessee in C.M.A. No. 1265 of 2014, following the abovesaid decision of this Court, dismissed the appeal filed by the Revenue.
15.?Accordingly, following the principles laid down in the decision reported in 2010 (255) E.L.T. 481 (Commissioner of Central Excise, Jaipur v. Rajasthan Spinning & Weaving Mills Ltd.) and the earlier decisions of this Court in C.M.A. No. 3101 of 2005, dated 13-12-2012 and C.M.A. No. 1265 of 2014, dated 10-7-2014, we are inclined to allow the appeal, thereby set aside the order of the Tribunal. Accordingly, this civil miscellaneous appeal stands allowed. No costs. Consequently, M.P. No. 1 of 2011 is closed."
7. Respectfully following the three Hon'ble High Court decisions in appellant's own case cited supra, and also maintaining this Tribunal order in the case of Dalmia Cements (Bharath) Ltd. Vs CCE Trichy (supra), we hold that appellants are eligible for capital goods credit used in "Dry Process Cement Manufacturing Plant". Accordingly, the impugned order is set aside and the appeal is allowed.
6. By respectfully following the Honble High Court decision and this Tribunals final order as above in appellants own case, all the four appeals are allowed with consequential relief.
(Order dictated and pronounced in the Open Court)
(P.K. CHOUDHARY) (R. PERIASAMI)
JUDICIAL MEMBER TECHNICAL MEMBER
BB
5