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2015 (11) TMI 89 - CESTAT MUMBAI

2015 (11) TMI 89 - CESTAT MUMBAI - TMI - Denial of CENVAT Credit - credit was availed such as Steel Plates, Foundation Bolt, HR Steel Coils, M.S. Angles, C.R. Sheets, Aluminum Coils & Aluminum Sheets used in the fabrication and erection of storage tanks - Capital goods - Held that:- Steel materials were used for fabrication and erection of storage tank within the factory of the appellant. The said storage tanks are undisputedly used for the storage of input finished goods and chemicals plant whi .....

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tubes and pipes are integral part of the entire plant. The pipes and tubes are compulsory for the purpose of maintaining temperature insulation and for such insulation the aluminium coils and sheets are used, therefore aluminium coils and sheets are used in plant and the credit should be allowed on such material.

Cenvat Credit on the same item i.e. Aluminium sheets/coils used for insulation for the purpose of cooling system, has been allowed. Following the ratio of the above judgment .....

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ified under Chapter 84 and admittedly used in the factory of the appellant, this is sufficient to qualify the item as capital goods in term of definition of capital goods. Therefore the Cenvat credit on the foundation bolt is clearly admissible.

Appellant have clearly expressed their intention and activity related to availment of Cenvat Credit on the items in question. With this information, the Revenue was at their own liberty to question the admissibility of Cenvat credit. I am of t .....

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ecided in favour of assessee. - APPEAL NO. E/85385/14 - Dated:- 25-6-2015 - Mr. Ramesh Nair, Member (Judicial) For the Petitioner : Ms. Anjali Hirawat, Advocate For the Respondent : Shri. Ashutosh Nath, Asstt. Commissioner (A.R.) ORDER Per : Ramesh Nair This appeal is directed against Order-in-Appeal No. SDK/218/BEL/2013-14 dtd. 29/10/2013 passed by the Commissioner (Appeals) of Central Excise, Mumbai III, wherein Ld. Commissioner (Appeals) upheld the Order-in-Original dated 27/11/2012 whereby C .....

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aw material and by product in their factory, availed Cenvat credit in respect M.S. Angles, challans, coils, foundation bolts for manufacture of various tanks in their plant for hot/chilled tank of various input/chemical. Appellant also availed Cenvat credit in respect of aluminium coils, aluminum sheets, used for thermal insulation of various pipes, tubes and machines installed in the plant. The department issued show cause notice proposing denial of Cenvat credit in respect of aforesaid goods. .....

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d. Counsel for the appellant submits that input on which the credit was availed such as Steel Plates, Foundation Bolt, HR Steel Coils, M.S. Angles, C.R. Sheets, Aluminum Coils & Aluminum Sheets used in the fabrication and erection of storage tanks. The storage tank is undisputedly capital goods as per the definition of Cenvat Credit Rules, therefore credit is admissible. She further submits that Cenvat Credit, in the identical case wherein input used for fabrication and erection of storage t .....

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td. Vs. CCE [2015(315) ELT 426 (T)] (h) CCE Vs. Doodhaganga Krishna Sahakari Sakkare Karkhane Niyamit[2013(297) ELT 361 (Kar)] (i) CCE Vs. ICL Sugars Ltd. [2011(271) ELT 360(Kar)] (j) Shree Rajashtan Syntex Ltd. Vs. CCE [2013(292) ELT 234 (Tri. Del.)] She submits that in view of the above judgments, Cenvat Credit in respect of material used in the fabrication or erection of storage tank is clearly admissible. She submits that even in some of the judgments the issue regarding move-ability/immovab .....

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gen Ltd. [2007(207) ELT 516(T)] (b) Shakumbari Sugar & Allied Inds. Ltd. Vs. CCE[2009 (245) ELT 878(T)] (c) UOI Vs. Associated Cement Company Ltd. [2008(223) ELT 582 (Raj.)] (d) UOI Vs. Grasim Industries Ltd. [2008(223) ELT 582 (Raj.)] (e) Hindustan Zinc Ltd. Vs. CCE [2012 (286) ELT 593(Tri. Del.)] She submits that in view of the above judgments the material used as insulation material in the plant is admissible for Cenvat Credit. As regard the credit on foundation bolt used in the erection .....

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06 informed department regarding set up of new IPA plant. She further submits that in view of the above communication to the department, the appellant had proved their bonafide that they never intended to take any wrong benefit. It was upon the department to issue a show cause notice, if at all the department of the view that credit was not admissible and show cause notice could not have been issued within the normal period. Since, the show cause notice, even after having submitted details regar .....

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matter was referred to the larger bench. The assessees through out the country had entertained bonafide belief, following earlier judgments on the issue of Cenvat Credit in respect of structural steel, that credit is admissible. It is only after Vandana Global judgment was delivered and earlier judgments which allowed credit on the similar items stood overruled. Therefore for this reason also, malafide intention to evade duty, cannot be construed against the appellant. Since the issue is highly .....

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ted and erected in the factory is immovable then it is not goods and therefore credit in respect of input service used for fabrication and erection of immovable goods is not admissible. In support of his submission he placed reliance on following judgments and Board Circular: (a) CBEC Order No. 58/1/2002 CX dated 15/1/2002 (b) CBEC- Instruction NO. 267/11/2010-CX dated 8/7/2010 (c) Ambuja Cements Ltd. Vs. Union of India [2010(256) ELT A59 (S.C)] (d) Hindustan Zinc Ltd. Vs. CCE [2012(286)ELT 593( .....

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on in the case Vandana Global Ltd. (supra). As regard the limitation, it is his submission that appellant have not disclosed the complete details of their availment of Cenvat Credit in respect of steel and aluminium items. The appellant also not disclosed details, where such items have been used and what type of capital goods are fabricated. In absence of any such details and particularly the appellant is working under the self assessment regime, it cannot be said that appellant have disclosed t .....

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pellant. The said storage tanks are undisputedly used for the storage of input finished goods and chemicals plant which is further used in the manufacture of the final product. In the chemical plant the storage tank is vital part of the entire plant and machinery. Therefore, in my view storage tank are capital goods. This issue has been dealt in the various judgments. In the case of SLR Steels Ltd.(supra) the Division bench of this Tribunal has held as under: 6.2 Before us also, the Revenue has .....

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al visit by the Assistant Commissioner to the factory premises of the appellant and vide his letter dated 27-12-2005, has confirmed that the said items were used only for the construction of Storage Tanks and Pollution Control equipments. If that be so, we find that the impugned order is totally incorrect and not in consonance with law as settled by the Honble Supreme Court in the case of Jawahar Mills Ltd. (cited supra). We also find that the decision of the Tribunal in the case of Lloyds Stee .....

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cement having been used for the manufacture of storage tanks is not disputed by the Revenue. In the absence of any contrary evidence to the factual evidence as noticed by the adjudicating authority during the visit to the factory premises, the impugned order is not sustainable. It is observed that in the above judgment the facts are absolutely identical to the fact of the present case. Moreover aspect of immovable properties of the capital goods was also examined and credit on steel material ha .....

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respect of input used in fabrication and erection of storage tank is admissible. As regard the Cenvat credit availed by the appellant in respect of aluminium sheets/coils etc. for insulation of pipes and tubes installed in the appellant factory, I find that in the chemical plant tubes and pipes are integral part of the entire plant. The pipes and tubes are compulsory for the purpose of maintaining temperature insulation and for such insulation the aluminium coils and sheets are used, therefore .....

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e, Primers and Paints conform to the definition of capital goods given in clauses (a) & (b) of Explanation 1 to Rule 57Q. Each of these items is either a machine, machinery, plant, equipment, apparatus, tool or appliance used for producing or processing of any goods or to bring about any change in any substance for the manufacture of final product or, is a component, spare part or accessory of such machine, machinery etc. The Revenues appeals have no merit as regards these items and have to .....

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luminium coils/sheets etc. used for insulation of pipes and tubes in the plant of the appellant. 6.3 As regard the credit on foundation bolt of stack which is used for installation of stack which in turn used for disposal of gas of the unwanted gases of the plant. The foundation bolt admittedly classified by the supplier under Chapter 84 as spare parts. In the definition of capital goods provided under the Cenvat Credit Rules certain chapter has been specified. One of the chapters is chapter 84, .....

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as under: Letter dated 12th July, 2005 This is to inform your office that we have recently stared work on our new IPA plant situated in Plot No. K-2, MIDC Indl. Area, Taloja, in our factory premises. The main excisable goods to be manufactured in this plant is ISO PROPANOL(IPA) and the by product viz. PROPANE and NORMAL PROPANOL(NPA). The intended annual production capacity of the above products will be as follows: (a) IPA 70,000 MTA (b) PROPANE 33,000 MTPA (c) NPA 4,400 MTPA The expected dat .....

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wish to state that though our Registration Certificate mentions our address only as Plot-K-1, MIDC Area, our all other plots are registered with Excise Department. The address Plot K-1, MIDC Indl. Area is mentioned as a general practice i.e. as appeared in our Letter Heads. We have requested your office about inclusion of other plots long back vide our letter no. 401/91-92/3009 dated 31/7/1991 alongwith detailed Ground Plan. The premises on plots and boundaries was once again informed to the .....

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