TMI Blog2013 (11) TMI 1036X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Sales Tax Act, 1956 has held that if a process or activity is so integrally related to the ultimate manufacture of good so that without that process or activity, manufacture may, even if theoretically possible, be commercially inexpedient, goods intended for use in that process or activity would qualify for special treatment i.e. for being treated as used in manufacture of goods. The scope of the expression used in or in relation to the manufacture of final product whether directly or indirectly in the definition of ‘input’ in the Cenvat Credit Rules, 2004 would be much more wider and any goods used in any process or an activity having nexus with manufacture of final product would be covered by the definition of ‘input’ and the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice dated 17/3/05 seeking recovery of the above-mentioned Cenvat credit alongwith interest and imposition of penalty. The show cause notice was adjudicated by the Additional Commissioner vide order-in-original dated 29/11/05 by which the above-mentioned Cenvat credit demand was confirmed alongwith interest and penalty of equal amount was imposed on the appellant. In this order, the Additional Commissioner while observing that the appellant s contention is that these items have been used essentially for repair and maintenance of the plant and machinery, discussed various judgments of the Tribunal on this issue and held that the goods used for repair and maintenance of the plant and machinery are not eligible for Cenvat credit. On appeal b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (256) E.L.T. 690 (Chhattisgarh), and Hon ble Karnataka High Court in the case of CCE, Bangalore -I vs. Alfred Herbert (India) Ltd. reported in 2010 (257) E.L.T. 29 (Kar.), and that in view of this, the impugned order upholding the Cenvat credit demand alongwith interest and imposition of penalty is not sustainable. 4. Shri Davinder Singh, the learned Jt. CDR, defended the impugned order by reiterating the findings of the Commissioner (Appeals) and pleaded that Cenvat credit in respect of welding electrodes used for repair and maintenance of the plant and machinery is not admissible in view of judgment of Larger Bench of the Tribunal in the case of Jay Pee Rewa Plant vs. CCE reported in 2003 (57) R.L.T. 739 (CESTAT -LB), that as regards A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nery and on this basis only, after discussing various judgments of the Tribunal, he has held that the items used for repair and maintenance of the plant and machinery are neither capital goods eligible for capital goods Cenvat credit nor the same are inputs used in the manufacture of capital goods. 6.1 In the CCE (Appeals) s order also, it has been accepted that the welding electrodes have been used for repair and maintenance of the plant and machinery and asbestos jointing sheets have been used to seal the leakage in tubes and pipes. Thus, even in terms of the Commissioner (Appeals)s order, the welding electrodes and the asbestos jointing sheets have been used for repair and maintenance of the plant and machinery. 6.2 As regards, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment of Hon ble Chhattisgarh High Court in the case of Ambuja Cements Eastern Ltd. vs. CCE, Raipur reported in 2010 (256) E.L.T. 690 (Chhattisgarh) and judgment of Hon ble Karnataka High Court in the case of CCE, Bangalore -I vs. Alfred Herbert (India) Ltd. reported in 2010 (257) E.L.T. 29 (Kar.). 8. In the impugned order, there is emphasise that the items used for repair and maintenance have no nexus with manufacture and hence the same cannot be treated as inputs. In this regard, the Apex Court in the case of J.K. Cotton Spinning and Weaving Mills Co. Ltd. vs. Sales Tax Officer reported in 1997 (91) E.L.T. 34 (S.C.) while interpreting the scope of the expression used in the manufacture in Section 8 (3) (b) of the Central Sales Tax Act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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