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2012 (12) TMI 940 - CESTAT NEW DELHIDenial of CENVAT Credit - Whether Ring Rim is eligible for Cenvat credit either as capital goods or as input - Held that:- Ring Rim which is a rubber item classifiable under Chapter 40 of the Central Excise Tariff, is an essential item for testing of the tyre and that it is also not disputed that every tyre prior to its clearance is required to be subjected to inflated dimension test for which Ring Rim is used. In view of this, I am of the prima facie view that Ring Rim is an item which is required in or in relation to the manufacture of rubber tyre, as a tyre without being tested cannot be marketed. In my prima facie view, the expression “in or in relation to the manufacture of final product, whether directly, or indirectly, whether contained in final product or not,” in the definition of ‘input’ is very wide and would cover, in addition to the items which are directly used in the manufacture of final product, the items which are indirectly used - impugned order denying the Cenvat credit in respect of this item is not correct and as such the appellant have prima facie case in their favour. The requirement of pre-deposit of Cenvat credit demand, interest and penalty is, therefore, waived for hearing of the appeal and recovery thereof is stayed till the disposal of the appeal - Stay granted.
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