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2020 (2) TMI 690 - HC - Central ExciseCENVAT Credit - capital units - lifting of Corporate Veil - all units have been merged at a later date, though at the time of receipt of capital goods, all the three units were separate entities and the goods were received and owned by M/s. JSWPL - HELD THAT:- The legal position is that, the ownership of the goods cannot be the criteria for denying the CENVAT credit assuming that the capital goods were purchased by JSWPL. However, the fact remains that, the capital goods were purchased in the name of JSWPL with Consignee SISCOL. The place where the CPP was set up is part and parcel of the factory premises of SISCOL originally and it has never been separated as a separate unit or entity as the water was supplied by SISCOL to CPP and the power being generated by CPP would be fully supplied and would be utilised by the SISCOL alone. The major funds for setting up of CPP also was generated only from the sources of SISCOL. Even before setting up of CPP, permission was sought for by JSWPL from the Deputy Chief Inspector of Factories, Salem on the pretext that, the SISCOL was taken over by Jindal. Further, even under the condition of Rule 2(a)(1) and (1A), the capital goods purchased for the purpose of setting up CPP were fully used only in the factory premises of the SISCOL and therefore, the said contention of the Revenue by the learned counsel that, under definition Clause in Rule 2(a)(1) and (1A) of the CENVAT Credit Rules, the SISCOL was not entitled to take the CENVAT credit does not hold any water, therefore it is liable to be rejected. Even if the CPP is located well away from the main factory of the manufacturer of final product, the capital goods purchased and utilised for such CPP even though not in the same factory premises, even then the manufacturer can take CENVAT credit. This has been explained and amplified by the subsequently amended Rule i.e., 2(a)(1A) of the CENVAT Credit Rules, 2004. Therefore, it has been explained or clarified in Rule (1A) which is in the aid of 2(a)(1). The case of the Revenue that the Assessee i.e., original SISCOL who got merged with JSW Steel Limited and JSW Power Limited, did not have the authority or right to take the CENVAT credit during the relevant point of time for the capital goods used in the CPP set up in the factory premises or vicinity of the SISCOL cannot be accepted, as such stand taken by the Revenue, is unsustainable - there is no hesitation to hold that the order of the CESTAT, which is impugned herein, is fully justifiable and sustainable - appeal dismissed.
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