2015 (6) TMI 1053 - AT - Central Excise

Denial of cenvat credit of Central Excise duty paid on S.S. Dozer Copper Bus Bar and M.S. Setter - Held that - Invoice on the strength of which cenvat credit has been taken by the appellant clearly indicate the disputed goods and their central excise Tariff classification. Therefore the observations of ld. Commissioner (Appeals) that no documentary evidences have been submitted by the appellant to prove that the goods are eligible for capital goods is not proper. Further storage tank is finding a place in clause (vii) in the definition of capital goods contained in Rule 2 (a)(A) of the Cenvat Credit Rules 2004. Therefore denial of credit on S.S. Dozer and M.S. Settler is not proper and justified. Since Copper Bus Bar is used by the appellant as component/spare or accessory to the electrical goods falling under Chapter 85 of the Tariff Act irrespective of the tariff classification of those disputed goods Cenvat credit is available considering the same as capital goods in terms of clause (iii) of Rule 2 (a)(A) of the Cenvat Credit Rules 2004.

Summary

Issues involved:
Denial of cenvat credit for Central Excise duty paid on specific goods categorized as capital goods by the appellant.

Analysis:
The appeal challenged the order of the Commissioner (Appeals) that denied cenvat credit on S.S. Dozer, Copper Bus Bar, and M.S. Setter, asserting that the appellant failed to provide documentary evidence supporting the classification of these goods as capital goods eligible for cenvat benefit. The appellant argued that S.S. Dozer and M.S. Settler were utilized as storage tanks for storing semi-finished goods within the factory, while Copper Bus Bar was described as special copper plates used in electrical equipment. The respondent, on the other hand, supported the findings of the impugned order.

Upon review, the tribunal noted that the invoices used for claiming cenvat credit clearly identified the disputed goods and their Central Excise Tariff classification. It was observed that storage tanks, including S.S. Dozer and M.S. Settler, fell within the definition of capital goods as per Rule 2(a)(A) of the Cenvat Credit Rules, 2004. Therefore, the denial of credit for these items was deemed unjustified. Regarding Copper Bus Bar, despite its specific use in electrical equipment, it was considered a component or accessory falling under Chapter 85 of the Tariff Act. Consequently, cenvat credit was deemed available for Copper Bus Bar under clause (iii) of Rule 2(a)(A) of the Cenvat Credit Rules, 2004.

In conclusion, the tribunal found no merit in the impugned order and set it aside, allowing the appeal in favor of the appellant. The judgment emphasized the importance of proper documentation and adherence to the definitions outlined in the Cenvat Credit Rules to determine the eligibility of goods for cenvat benefits.