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The India Cements Ltd. Versus Commissioner of Central Excise, Trichy

Denial of credit on parts of surface miners used in the mines - Availment of credit on CCTV Cameras used in the Kiln - Whether percentage of eligibility of credit is 75% or 100% on the goods cleared under project imports prior to 1.3.1997 - Held that:- As per the directions of the Hon’ble High Court, Madras, we have examined the admissibility of credit on each of the inputs used in the mines and whether the appellants have their own captive mines. This Tribunal in CCE Trichy Vs The India Cements .....

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es and are admissible for credit. It is seen that there are a large number of decisions holding the eligibility for capital goods which are used in the mines and outside the factory premises.

Appellants are eligible for credit on parts of surface miners. Further, we find that the goods were imported under project import as is evident from the show cause notice and rightly classifiable under 9801 and not under chapter 8430. The act of the department in seeking to classify the goods un .....

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levant. - appellants are eligible for credit on parts of surface miners, CCTV Cameras installed in the Kiln and they are also eligible for 100% credit on the CVD paid on the goods imported under project imports. Accordingly, the impugned order is set aside - Appeal No. E/1115/2003 - Final Order No. 41153/2015 - Dated:- 31-8-2015 - Shri R. Periasami, Technical Member And Hon ble Shri P.K. Choudhary, Judicial Member For the Appellant : Shri S. Muthuvenkatraman, Advocate For the Respondent : Shri R .....

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t is clear that the Tribunal is the final fact finding authority in the hierarchical chain. A perusal of the order under challenge would reveal that the facts, which are relevant for deciding the appeal, have not been discussed at all and as to how the decision of the Supreme Court and the Tribunal are applicable to the facts of the case. No reasons have been recorded by the Tribunal to arrive at the finding. This Court wishes to point out that the Tribunal could have been a little more explicit .....

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find that all the three issues are covered by the cited decisions of the Hon'ble Supreme Court and the Tribunal under which the credit denied in respect of the three different items have been allowed. Following the ratio of the cited decisions, we set aside the impugned order in so far as it relates to the above three categories of impugned goods and allow the appeal. The cross-objection stands disposed off." 8. From the above order it is evident that the facts in issue, as has been ra .....

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rder of the Tribunal and remanding the matter back to the Tribunal for passing a detailed and reasoned order. However, in the circumstances of the case there shall be no order as to costs." 2. We find that the issue involved in the present appeal relates to denial of credit on (i) denial of credit on parts of surface miners used in the mines (ii) availment of credit on CCTV Cameras used in the Kiln (iii) Whether percentage of eligibility of credit is 75% or 100% on the goods cleared under p .....

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ted in 2006 (194) E.L.T. 3 (S.C.) wherein it was held that the mines of the appellant s factory are their captive ones. 3.1 As regards credit availed on CCTV Cameras, he submitted that same were used inside the kiln and relied upon the following judgement reported in 2009 (243) E.L.T. 577 (Tri. - Che) CC Ex. Madurai vs. Sterlite Industries (P) Ltd. 3.2 On the third issue, he submitted that they are eligible for 100% credit. He relied on the case law reported in CCE Jaipur Vs Raj Cement reported .....

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ed on the decision of this Bench in the appellant's own case reported in India Cements Ltd. Vs CCE Trichy - 2010 (254) ELT 344 (Tri.-Chennai). 5. After hearing both sides, we find that the issue in the present appeal relates to denial of credit on three issues (i) denial of credit on parts of surface mines used in the mines (ii) availment of credit on CCTV Cameras used in the Kiln (iii) eligibility of 100% credit on the goods cleared under project imports prior to 1.3.1997. As per the direct .....

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goods at mines. Further, we find that in the appellant's own case, the Tribunal in the case of CCE Trichy Vs India Cements (supra) reported in 2010 (251) E.L.T. 299 (Tri. - Chennai) had held that credit on Lubricants used in machinery like surface miner, dumper, etc. in captive mines and are admissible for credit. It is seen that there are a large number of decisions holding the eligibility for capital goods which are used in the mines and outside the factory premises. One of the judgments .....

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e reported in 2010-TIOL-59-SC-CX. The Hon ble High Court also answered substantial questions of law in favour of the appellant/assessee and against the department/respondent. Therefore, in view of above High Court's decision, we hold that appellants are eligible for credit on parts of surface miners. Further, we find that the goods were imported under project import as is evident from the show cause notice and rightly classifiable under 9801 and not under chapter 8430. The act of the departm .....

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low: 2. We have heard both sides. We find that PLC Hardware, CCTV System and Radio Remote Control are instrumentation materials used in the control system of the plant for monitoring the manufacturing activity; that all the high speed rotating systems are controlled by the PLC Hardware. CCTV system is a remote eye which controls the fuel process. The Radio Remote Control is also used to monitor the manufacturing activity. Memory Module accessories are instrumentation spares used in direct contro .....

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s lance operation, tapping, pellatisation etc. are monitored by operators through CCTVs. Camera/Monitor Mount is part of the CCTV. Therefore, they are to be treated as accessories of the smelter plant and hence eligible to credit. and in the case of Jaypee Bela Plant Vs CCE Raipur 2003 (161) ELT 422 (Tri.-Del.) the Tribunal clearly held that CCTV is directly related to the manufacturing process. In the present case, CCTVs were fixed inside the kiln in the cement factory. The learned Advocate sub .....

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ringing about any change in the manufacture of final products. We agree with the submissions of learned Advocate that CCTVs are eligible capital goods as they take part in producing or processing of any goods because they are used to monitor the burning zone area of kiln. We accordingly hold that they are eligible to take the Modvat credit of the duty paid on CCTVs. 8. As regards admissibility of 100% of credit on the project import goods, we find that credit goods were imported in March 1996. W .....

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for 100% credit. The Tribunal in the case of CCE Vs Raj Cement (supra) clearly held as under: 10. We have heard the rival submissions. We have? also perused the evidence on record as also the various case law cited by the respondent. On careful consideration of the various submissions made before us and the case law cited, we note that the basic issue that arises for determination in this case is whether the respondent herein was entitled to Modvat credit at 75% or 100% of CVD paid on imported g .....

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