TMI Blog2010 (12) TMI 368X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 194/CE/MRT-I/2008 dated 31-10-2008. 2. Heard both sides. 3. The appellants have been denied Cenvat Credit on certain items claimed as inputs and certain other items claimed by them as capital goods and Original Authority confirmed demand of R. 3,86,288/- alongwith interest and imposed equal amount of penalty. Order of the Original Authority stands upheld by the Commissioner (Appeals). 4. Ld. Advocate for the appellants, at the outset submits that due to smallness of amounts they are not contesting the demand relating to M. Seal, Chain, Fire creat, Electric goods and cables. Total amount involved is Rs. 17,217/- and interest there of. However, he is contesting penalty imposed. Drawing my attention to the detailed use of the inputs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e settlingrate of non-sugar participants from sugar, which result in removal of non-sugar participants front the sugar. (iv) D.P. LINER [LDP Liner] TH. 39.23 This is used for lining of Gunny Bags after packing of sugar in such bags. This is a packing material directly used for packing of sugar. (v) RENICIDE - TH. 38.08 This is used during the process of milling of the cane to prevent bacterial growth during this process. This helps in removal of bacteria, fungus and dextran etc., from the sugarcane juice and adds to the output of sugar. 7. Use of these items as mentioned above, clearly indicates that they are to be considered as inputs. In respect of welding electrodes as pointed out by the ld. Advocate, the welding electrodes use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Capital Goods as Components, spares and accessories of goods specified at (i) under clause (iii). (iii) SPARES OF BOILER (T.H. 6901/6807) Boiler is an important machinery in Sugar Plant. Boiler falls under T.H. 8402 of the Central Excise Tariff Act. The goods in question have been used for insulation of the boiler. Therefore, the same being parts/components/accessories of Boiler falling under specified Chapter 84, are duly covered within the definition of Capital Goods, as in case of (i) (ii) above. (iv) SPARES OF MACHINES C.S. HUB for Conveyer Idler Roller C.S. Brake Drum Puller for Cane Unloader C CT Wheel for Cane Unloader. The description of the above items as mentioned in the invoice No. 170 dated 25-8-2005 of M/s. Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e it is a part of the process of providing output services. 10. While the capital goods are required to fall under specified Chapter Headings 84 and 85, there is no such restriction for spares, accessories of such capital goods to be considered as capital goods. It has not been disputed that the items claimed were used in Cane Loader as spares of boiler and machines. 11. In view of the above, the denial of credit on these items is not justified. 12. In the light of the above, the appeal is disposed of as follows :- (a) The demand to the extend of Rs. 17,270/- alongwith interest is upheld as uncontested. (b) Rest of the demand amounting to Rs. 3,69,018/- is set aside. (c) The entire penalty is set aside. (Dictated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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