TMI Blog2006 (3) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... o units, the Power Plant should be considered as being within the appellant s factory. We note the decisions relied upon by the appellant Strong reliance has been made to the Tribunal s decision in the case of Jammu Auto Industries v. CCE, [ 2000 (9) TMI 146 - CEGAT, NEW DELHI] , observed that in terms of sub-rules (20) and (21) of Rule 57D, the question of application of Rule 57F(2) does not arise inasmuch as the said sub-rules are self-contained and covers transfer of the credit lying in the books of the seller. However, we find that in that case the issue before the Bench was as regards transfer of the credit on change in ownership of the factory. In the present case, the credit earned by the first appellant cannot be transferred to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Rotor/Insurance spares were also sold by the appellant-company to M/s. SAIL Power Supply Co. Ltd. along with the power plant. There is no dispute about the above facts. 2. As a result of certain investigation conducted and the statements of various authorised representatives recorded, the Revenue was of the view that the appellant was required to reverse back the Modvat credit taken on the said Rotor/Insurance spares in terms of the provisions of Rule 57AB(1C) of the Central Excise Rules, 1944, on sale of the same to a third party. For the above purposes, proceedings were initiated against them by way of issuance of a Show Cause Notice dated 17-9-2002. In response to the above proceedings, the appellant contended that the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd not deemed removal. For the above proposition, they have referred to various decisions, which we shall be considering in the subsequent paragraphs. 3. As against the above contention of the appellant, the adjudicating authority has held that transfer of the Rotor/Insurance spares along with sale of Captive Power Plant amounts to transfer on "as is where is" basis to a separate newly found company. As a result of sale, the ground plan was amended and Captive Power Plant was excluded from their factory. The Rotor assembly in question stored in the said Captive Power Plant without being used in the manufacture of the final product was also transferred to the new unit. Such sale/transfer of the unit will amount to removal of capital goods ly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al shall be made under the cover of an invoice referred to in Rule 52A. Sub-rule (1) of the said Rule 57AB reads as under : the amount paid under sub-rule (1C) shall be eligible as credit as if it was a duty paid by the person who removed such goods under sub-rule (1C). 6. As rightly observed by the Commissioner, perusal of the above provisions reveal that the amount payable under sub-rule (1C) is deemed duty of excise and credit thereof can be taken by the eligible manufacturer. In terms of the provisions of Rule 9(1), no excisable goods can be removed from any place without payment of duty, even if the same are removed for manufacture of any other commodity in such place. Similarly in Rule 49, every manufacturer shall discharge his duty l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oved to a new piece of land and instead have been removed from the appellant s factory along with the land. The legislative intent, while reading the modvat provisions in their entirety, comes out clear that in case of modvatable capital goods not being in use of the assessee, who availed the credit on the same, the credit will liable to be reversed. Of course, the same would be available to the new purchaser, as credit by treating the reversal as payment of duty. Such legislative intent cannot be defeated by giving hyper technical and too narrow meaning to the expression removed . Any interpretation, which does not further the legislative intent but defeats the same has to be avoided. 8. The Commissioner s reliance on the Tribunal s decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of electricity, which is not liable to pay Central Excise duty. 10. In the case of Tata Motors Pvt. Ltd. v. CCE, Jamshedpur - 2005 (190) E.L.T. 269 (Tribunal) = 2005 (71) RLT 204 (Cestat-Mum) , the Tribunal has held that capital goods hived off to others/subsidiaries within same premises cannot be equated with physical removal of the same and demands are not sustainable. To the similar effect is another decision of the Tribunal in the case of Indorama Synthetic (India) Ltd. being Order No. A/845/WZB/2005/C-II, dated 26-5-2005 [2005 (190) E.L.T. 193 (Tri. - Mumbai)] laying down that the mere change in ownership and possession of the capital goods will not amount to removal of the same as removal means physical shifting of goods. 11. As ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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