Custom, Excise & Service Tax Tribunal
M/S Bajaj Hindustan Limited vs Cce, Meerut I on 26 February, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL West Block No. 2, R.K. Puram, New Delhi 110 066. Principal Bench, New Delhi COURT NO. IV Excise Appeal No. 498 of 2011 (SM) [Arising out of the Order-in-Appeal No. 244/CE/MRT-I/2010-11 dated 29/10/2010 passed by The Commissioner (Appeals), Customs, Central Excise, Meerut I.] For Approval and signature : Honble Shri Rakesh Kumar, Member (Technical) 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 would 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 : Department Authorities? M/s Bajaj Hindustan Limited Appellant Versus CCE, Meerut I Respondent
Appearance Shri R.K. Mittal, Advocate for the appellant.
Shri R.K. Mathur, Authorized Representative (DR) - for the Respondent.
CORAM : Honble Shri Rakesh Kumar, Member (Technical) DATE OF HEARING : 26/02/2013.
Final Order No. 55720/2013 Dated : 26/02/2013 Per. Rakesh Kumar :-
The appellant are manufacturers of sugar and molasses chargeable to Central Excise duty. There are three points of dispute in this case with regard to Cenvat credit (1) whether appellant are eligible for Cenvat credit in respect of welding electrodes used for repair and maintenance of plant and machinery, (2) whether the appellant are eligible for Cenvat credit of service tax paid on rent a cab service availed for bringing workers to their factory and dropping them back and (3) whether the appellant are eligible for Cenvat credit in respect of angles, channels, beams etc. which according to them were used for fabrication of various items of capital goods and their components. The department disallowed total Cenvat credit of Rs. 2,65,595/- in respect of welding electrodes rent a cab service availed and angles, channels etc. and in this regard, the Jurisdictional Assistant Commissioner vide order-in-original dated 31/3/10 confirmed the Cenvat credit demand of the above amount alongwith interest and imposed penalty of equal amount on the appellant. On appeal to Commissioner (Appeals), the above order of the Assistant Commissioner was upheld except for setting aside of entire penalty on the ground that the dispute is relating to interpretation of the Rules. Against this order of the Commissioner (Appeals), this appeal has been filed.
2. Heard both the sides.
3. Shri R.K. Mittal, Advocate, the learned Counsel for the appellants, pleaded that so far as the admissibility of Cenvat credit in respect of welding electrodes used for repair and maintenance of the plant and machinery, the issue stand decided in their favour by judgment of Honble Chhattisgarh High Court in the case of Ambuja Cements Eastern Ltd. vs. CCE, Raipur reported in 2010 (256) E.L.T. 690 (Chhattisgarh) and also by the judgments of Honble Rajasthan High Court in the case of Hindustan Zinc vs. Union of India reported in 2008 (228) E.L.T. 517 (Raj.) and Honble Karnataka High Court in the case of CCE, Bangalore vs. Alfred Herbert (India) Ltd. reported in 2010 (257) E.L.T. 29 (Karnataka), that so far as Cenvat credit in respect of rent-a-cab service availed for bringing workers to the factory and dropping them back is concerned, this issue also stands decided in the appellants favour by the judgment of the Tribunal in the case of CCE, Vadodara vs. Haldyn Glass Gujarat Ltd. reported in 2009 (240) E.L.T. 729 (Tri. Ahmd.), that so far as Cenvat credit in respect of M.S. Angles, Channels, Beams etc. is concerned, the appellant have used these items for fabrication of various items of capital goods, that the department has wrongly alleged that these items had been used only for supporting structures of the machinery, that in the appellants own case for the previous period, the matter had been remanded to the original Adjudicating Authority vide final order No. 349/2012- SM (BR) dated 9th April, 2012 and No. 469/2012 SM (BR) dated 26th April 2012 and that in view of this, in respect of this appeal also so far as the dispute relating admissibility of Cenvat credit in respect of M.S. Angles, Channels, Beams etc. is concerned, the matter may be remanded to the original Adjudicating Authority for fresh decision after considering the appellants plea regarding the actual use of these items.
4. Shri R.K. Mathur, the learned Departmental Representative, defended the impugned order by reiterating the findings of the Commissioner (Appeals) in it. He also pleaded that the steel items, in question, have been used for supporting structures fixed to earth and the appellants claim regarding use of these items for fabrication of various items of capital goods or their components is not correct.
5. I have carefully considered the submissions from both the sides and have perused the record.
6. So far as the welding electrodes used for repair and maintenance of the plant and machinery is concerned, the issue of admissibility of Cenvat credit stands decided in the favour of the appellant by the judgments of Honble Chhattisgarh High Court in the case of Ambuja Cements Eastern Ltd. vs. CCE, Raipur (supra), Honble Rajasthan High Court in case of M/s Hindustan Zinc Limited vs. Union of India (supra) and Honble Karnataka High Court in case of CCE, Bangalore vs. Alfred Herbert (India) Ltd. (supra) and, hence, the order disallowing the Cenvat credit in respect of welding electrodes is not sustainable and is liable to be set aside.
7. As regards the eligibility for Cenvat credit in respect of rent-a-cab service used for bringing the employees to the factory and dropping them back home, the issue stand decided in the appellant favour in the case of CCE, Vadodara vs. Haldyn Glass Gujarat Ltd. (supra) and, therefore, the impugned order on this point also is not sustainable and is liable to be set aside.
8. However, as regards the third issue regarding admissibility of Cenvat credit on MS Angles, Channels, Beams etc., the dispute is over the user of these items. While according to the appellant these items have been used for fabrication of various items of capital goods or their parts, according to the department these items have been used only for erection of supporting structures for the machinery which are fixed to earth and, therefore, in view of Larger Bench judgment of the Tribunal in the case of Vandana Global Ltd. vs. CCE, Raipur reported in 2010 (253) E.L.T. 440 (Tri. LB), such use would not be eligible for Cenvat credit. This point, in my view is a point of fact for which this matter has to be remanded, as in respect of appellants appeal for earlier period also involving this issue, the matter had been remanded. In the remand proceedings, the Adjudicating Authority must examine the appellants claim regarding the user of the steel items keeping in view the fact as to whether the fabrication of capital goods had been declared in the ER-1 returns or had been intimated to the department by any other means and also any other evidence in this regard produced by the appellant.
9. In view of the above discussion, while the Commissioner (Appeals)s order disallowing the Cenvat credit in respect of welding electrodes and rent a cab service is set aside and the appeal on these points is allowed. The matter relating to admissibility of Cenvat credit in respect of MS Angles, Channels, Beams etc., is remanded back to the original Adjudicating Authority for denovo adjudication, keeping in view the observations above.
(Pronounced in the open court.) (Rakesh Kumar) Member (Technical) PK ??
??
??
??
5