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2016 (9) TMI 1097 - AT - Central ExciseCenvat credit - availed on 836.99 MT of steels used for fabrication of misc. structures - Rules 12 and 13 of erstwhile Cenvat Credit Rules, 2001/2002 read with Section 11 A of the Central Excise Act, 1944 - three main categories of items viz., M.S. Beams, Angles, Plates and Channels used to support the various ducts and cyclones in the appellant's factory, iron steel items used for fabricating, attending platforms, which are generally erected around a machinery and staircases and ladders and fabricated using the angles, plates, etc. Held that:- the lower authorities denied the credit mainly on the ground that the M.S. items, on which credits have been taken are falling under Chapter 72, which is not covered under the category of capital goods . The second main objection is that these items were used for fabricating the structures, which become immovable upon fixing and hence, results in a non-excisable item. Hence, the credit is not eligible on any of them. We find that the denial of credit by the lower authorities is on the ground that the items are not used in the manufacture of capital goods as none of the items, as described above, arising after fabrication, can be considered as accessories of the capital goods. Further, they become immovable upon fabrication. We find both these arguments as un-sustainable. Much emphasis has been made on the requirement and necessity of emergence of excisable items after fabrication using the impugned goods. We do not find any such requirement specifically mentioned in the definition of either in the inputs or capital goods under Cenvat Credit Rules. In the present case, the lower authorities have not categorically established that upon fabrication, an immovable civil structure is emerged. Fabrication of structural as an accessory for necessary operation of capital machinery cannot be considered as creation of immovable property. It is relevant to note the Hon’ble Supreme Court’s observation in Rajasthan Spg. & Wvg. Mills Ltd. [2010 (7) TMI 12 - SUPREME COURT OF INDIA]. The Hon’ble Apex Court allowed the credit on steel plates and M.S. channels used in the fabrication of chimney applying user test . In other words, the usage of a particular item in the appellant s premises will determine the credit eligibility rather than its classification alone. Hence, we find no merit in the impugned order and accordingly set aside the same. - Decided in favour of appellant
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