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2022 (9) TMI 740 - SC - Central ExciseMODVAT Credit - Capital goods - Guide Car - classifiable under Chapter subheading 8603.00 or under Chapter sub-heading 8428.90 of the Central Excise Tariff Act, 1985 or not - whether the appellant is entitled to Modvat credit under Rule 57Q of the Rules 1944 on ‘Guide Cars’ treating the same as ‘components’ of Coke Oven Battery, as claimed? HELD THAT:- The test would be whether the ‘Guide Car’ can be said to be an integral part necessary to the constitution of the whole article, namely, Coke Oven Battery and whether without it, the Coke Oven Battery shall not be complete? Considering the process and the manner in which and/or for the purpose for which the ‘Guide Car’ is used, by no stretch of imagination, it can be said to be a ‘component’ of Coke Oven Battery. It cannot be said that without the ‘Guide Car’ the Coke Oven Battery shall not be functional. The ‘Guide Car’ is being used for the purpose of transporting the hot coke after it is processed in the Coke Oven Battery. Therefore, ‘Guide Car’ can be said to be a different equipment distinct from the Coke Oven Battery and cannot be considered to be a part of the Coke Oven Battery. In that view of the matter, the appellant shall not be entitled to the Modvat credit on ‘Guide Car’ as ‘component’ and/or part of Coke Oven Battery as claimed by the appellant. The Adjudicating Authority as well as the learned Tribunal have rightly confirmed the demand of Modvat credit availed by the appellant on ‘Guide Cars’. Levy of penalty - HELD THAT:- The penalty was not justified at all. The appellant bonafidely believed that the goods would fall under Chapter sub-heading 8428.90 and/or that the ‘Guide Car’ can be said to be a ‘component’ of the Coke Oven Battery. Therefore, the order of penalty of Rs.1,00,000/- imposed by the Tribunal is required to be quashed and set aside. Whether classification of the ‘Guide Car’ under Chapter sub-heading 8603.00 shall be applicable prospectively and shall not be applicable retrospectively with respect to supply in the month of November, 1999? - HELD THAT:- It is required to be noted that it was a case of self-assessment by the supplier and the supplier classified the ’Guide Car’ under Chapter subheading 8428.90, though it was classifiable under Chapter sub-heading 8603.00. That thereafter the appropriate authority classified the ‘Guide Car’ under Chapter sub-heading 8603.00. Therefore, it will relate back to the original claim and/or relate back to the date of supply/selfassessment. The present appeal with respect to Modvat credit claimed by the appellant on ‘Guide Car’ is hereby dismissed. The Adjudicating Authority as well as the learned Tribunal have rightly denied the Modvat credit to the appellant on ‘Guide Car’. The learned Tribunal has rightly confirmed the demand of Rs. 45,86,664/- being the Modvat credit availed by the appellant on ‘Guide Car’ - Appeal dismissed.
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