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Commissioner of C. EX. & S.T., Raipur Versus SKS Ispat and Power Ltd.

Entitlement to take Cenvat credit on rails - rails are fixed to the earth and EOT cranes are being run over them - Held that:- Credit on capital goods is available only on items, which are excisable goods covered under the definition of capital goods’ under Cenvat Credit Rules, 2004 and used in the factory of the manufacturer. As regards ‘inputs’, they have to be covered under the definition of ‘input’ under the Cenvat Credit Rules, 2004 and used in or integrally connected with the process of ac .....

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enance of capital goods.

In the instant case revenue has also failed to bring the evidences on record to show that the Appellant had used such inputs for construction of factory shed, building or laying of foundation or making of structures for support of capital goods. On the other hand the appellant has shown that the said inputs were used in the manufacture of Capital goods, under clause (i) of Rule 2(a) of Cenvat Credit Rules, 2004. - Decided in favour of assessee - E/60307/2013-E .....

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In these circumstances, the respondent not entitled to take Cenvat credit. In support to his contention he relied on the decision in the case of Nelvetha Cast Steels (P) Ltd. v. CCE, Madhurai - 2013 (294) E.L.T. 127 (Tri.-Chennai) to say that the support will not automatically become the part of crane. 3. None appeared on behalf of the respondent. 4. Matter is taken up for consideration and I have perused the impugned order wherein ld. Commissioner (A) has examined the issue on the bas .....

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astava, Chartered Engineer showing the quantity of various structural steel items such as Rails used for EOT crane, Cooling Bed & Chattal in their Rolling unit. Further the appellant has discussed in the appellant memo regarding use of structural steel items i.e. Rails in their Rolling Mill and final product. EOT Crane : The Rails used for fabricating overhead track for movement of EOT Crane. Rails are used for sliding & functioning of Electric Overhead Transport Crane. Without Rails EOT .....

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ning of EOT Crane Rails are essential component part. The EOT Crane falls under chapter 84 of Central Excise Tariff Act, 1985 which is a capital goods item. The same is duly supported with photo graphs and chartered Engineer certificate. Cooling Bed : In the Rolling Mill of the appellant after manufacture of finished product i.e. Rolled products (Angles, Channels, Beams etc.) reaches to the Cooling Bed for cooling. This Cooling Bed is mainly made from Rails. It is a place where finished goods ar .....

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lled products i.e. finished product of the appellant, the Rolled products goes to Chattal of Rolling Mills for quality Checks and then finally shift to dispatch yard. This chattal is mainly made form Rails and situated adjacent to the Cooling Bed. It is essential component part of Rolling Mill where manufacture of final goods completed. The Rolling Mill is classified under chapter heading No. 84. The same is duly supported with photo graphs and chartered Engineer certificate. 5.3 In the ins .....

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ike cement and steel items used for laying foundation and for building supporting structures cannot be treated as either inputs for capital goods or as inputs in relation to the manufacture final products and therefore, no credit of duty paid on the same can be allowed under the Cenvat Credit Rules, 2004. It has also been stated by the Tribunal that, amendment to Explanation 2 to Rule 2(k) of Cenvat Credit Rules, 2004 inserted vide Notification No. 16/2009-CE, dated 7-7-2009 is clarificatory in .....

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like Cement, angles, channels, CTD or TMT bars and other items used for construction of factory shed, building or laying foundation or making of structures for support of capital goods. From the above it is obvious that, if an assessee manufactures items i.e. Capital goods or its parts, components, or accessory out of the structural steel items, then there is no bar/restriction in the availment of Cenvat credit on these items. In the instant case I find that, the Appellant had furnished the doc .....

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of raw material received, quantity received & used for final product and manufacture of resultant items said to have been manufactured out of the impugned items. I find that, they have availed Cenvat credit on structural items i.e. Rails used for manufacture of components of EOT Crane and Cooling Bed etc. which have a definite function in relation to manufacture of their final product i.e. Rolled products in Rolling Mills Division and is entirely different from the supporting structures of p .....

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gned structural items. I also find that, the impugned structural items i.e. Rails are not supporting structures of Plant & Machinery or for laying foundation and hence the findings of the adjudicating authority that, these are not goods being embedded to the earth are in the nature of immovable goods and are not goods or excisable goods in terms of CBEC Circular No. 58/1/2002-CX, dated 15-1-2002 is not proper. From the Cenvat credit details I find that, they have availed Cenvat credit on acc .....

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2004 and the inputs used for manufacture of the said items are input in terms of Explanation 2 to Rule 2(k) of Cenvat Credit Rules, 2004. 5.5(i) In support of my findings, I have gone though the case of Madras Cements Ltd. v. CCE reported in 2010 (176) ECR 0087 (SC), in which the Hon ble Supreme Court while dismissing the appeal filed by the Appellants held that, in order to avail Modvat/Cenvat credit, an assesses has to satisfy the Assessing authorities that the Capital Goods in the form .....

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nputs & capital goods discussed supra. Held accordingly. 5.5(ii) Further I got support from Hon ble High Court of Chhattisgarh in the case of Union of India v. ACC Ltd. reported in 2011 (267) E.L.T. 55 (Chhattisgarh) held that, Cenvat/Modvat - Capital goods - Credit on wear plate, HRSS plate, MS plate, angles and channels - allowed credit on steel plates and MS channels used in fabrication of chimney for diesel generating set - Credit allowed for connecting/fitting fans, casing and duct .....

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hi dated the 8th July, 2010 Subject : Availability of Cenvat credit on inputs used in the manufacture of capital goods - Regarding I am directed to invite your attention to the landmark judgment of the CESTAT Larger Bench in the case of Vandana Global Ltd. v. CCE, Raipur [AIT-2010-167-CESTAT-LB] delivered on 30-4-2010, on admissibility of credit on capital goods and inputs and to state that the Tribunal has ruled that capital goods defined in the Cenvat Credit Rules, in the context of providing .....

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duty paid on the same can be allowed under the Cenvat Credit Rules. It has also been stated by Tribunal that amendment to Explanation 2 to Rule 2(k) of Cenvat Credit Rules, 2004 inserted vide Notification No. 16/2009-CE (NT), dated 7-7-2009, is clarificatory in nature and has retrospective effect. 2. Attention is also drawn to the Tribunal s judgment in the case of Vikram Cement v. CCE, Indore [2009 (242) E.L.T. 545 (Tri.-Del.)], where the Tribunal held that credit on welding electrodes us .....

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