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2010 (4) TMI 133 - AT - Central Excise
Cenvat Credit - (a) Whether the term "capital goods" can include plant, structures embedded to earth? (b) Whether the goods like angles, joists, beam, channels, bars, flats which go into fabrication of such structures can be treated as 'inputs' in relation to their final products as inputs for capital goods, or none of the above? (c) Whether the credit can be allowed in respect of goods like angles, joists, beam, channels, bars, flats which go into fabrication of such structures and plant?
Held that: The intention behind the 2009 amendment to Explanation 2 to Rule 2(k) was merely to clarify the coverage under the expression "input" used in the CENVAT Credit Rules, 2004. There was no indication whatsoever that the 2009 amendment was made to change the scope of the Rules or to introduce any new provision. - the clarificatory amendment made to Explanation 2 to Rule 2(k) in 2009 has to be held to be retrospectively applicable.
The Section 37(2) refers to credit of duty paid on goods used in, or in relation to the manufacture of excisable goods. Hence, 'capital goods' defined in the CENVAT Credit Rules in the context of providing credit of duty paid, have to be excisable goods. - Goods like cement and steel items used for laying 'foundation' and for building 'supporting structures' cannot be treated either as inputs for capital goods or as inputs in relation to the final products and therefore, no credit of duty paid on the same can be allowed under the CENVAT Credit Rules for the impugned period.