2016 (2) TMI 902 - SC - Central Excise

Entitlement for Cenvat credit - Whether the definition of the term input in Rule 2(g) of the CENVAT Credit Rules 2002 is to be understood to include items beyond the six items mentioned specifically in Rule2(g) - Held that - as per three judge bench decision of this Court in Regional Director Employees State Insurance Corporation vs. High Land Coffee Works of P.F.X. Saldanha and Sons & Anr. 1991 (7) TMI 367 - SUPREME COURT OF INDIA the word include in the statutory definition is generally used to enlarge the meaning of the preceding words and it is by way of extension and not with restriction. Therefore it is left for the appropriate bench of this Court to decide on the factual parameters of the case(s) and the entitlement of the assessee(s) to CENVAT credit in the facts of each case. - Appeal disposed of

Summary

Issues:
Interpretation of the term "input" in Rule 2(g) of the CENVAT Credit Rules, 2002.

Analysis:
The Supreme Court, comprising Justices Ranjan Gogoi, Arun Mishra, and Prafulla C Pant, considered the issue of interpreting the term "input" in Rule 2(g) of the CENVAT Credit Rules, 2002. The Court referred to a previous order directing the matter to a larger bench to decide whether the definition of "input" includes items beyond the six specifically mentioned in Rule 2(g). The Court noted that the term "include" in a statutory definition is typically used to broaden the meaning of the preceding words without limitation. The Court cited a previous decision in Regional Director, Employees' State Insurance Corporation vs. High Land Coffee Works, emphasizing that the term "include" extends the meaning rather than restricting it. The Court provided a clear answer to the question referred, stating that the term "input" should be understood expansively, and the entitlement to CENVAT credit would depend on the factual circumstances of each case. The Court left the decision on the factual aspects and credit entitlement to the appropriate bench for individual cases.

This judgment clarifies the interpretation of the term "input" under the CENVAT Credit Rules, emphasizing that the term should be broadly construed to encompass items beyond those specifically listed in the rule. The Court's decision aligns with the principle that the term "include" in a statutory definition serves to expand the scope of the defined term. By referring to previous judgments and highlighting the purpose of statutory interpretation, the Court provided guidance for future cases involving the application of CENVAT credit rules. The judgment underscores the importance of considering the context and purpose of statutory provisions while interpreting legal definitions, ensuring a comprehensive understanding of the legislative intent behind such rules.