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2016 (3) TMI 614 - CESTAT MUMBAI

2016 (3) TMI 614 - CESTAT MUMBAI - TMI - Eligible to avail CENVAT Credit on cascades, various compressors installed at DBS for dispensing the CNG into the vehicles or otherwise - Held that:- It is undisputed that the compression of natural gas takes place at Mother Station where the appellants have installed various machines where the compression of natural gas is considered as an activity of manufacturing. Hence, CENVAT Credit availed on such capital goods at mother station is quite rightly und .....

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out any merits inasmuch CNG is already a marketable commodity, and the activity of recompression is neither incidental nor ancillary for manufacture of CNG at DBS as the recompression is of CNG. - Secondly, reliance was placed on the Chapter Note 5 to the Chapter 27. The said Chapter Note will not be of any help to the appellant's case as the said Chapter Note talks about the compression of natural gas for the purpose of marketing the CNG would amount to manufacture, in the case in hand, the .....

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the Revenue authorities but the credit of duty paid on cascades and compressor used at DBS, were not indicated as being installed and commissioned at DBS. - Decided against assessee - Appeal No. E/1037/06 & E/303/09 - A/85166-85167/16/EB - Dated:- 6-1-2016 - M V Ravindran, Member (J) And C J Mathew, Member (T) For the Appellant : Shri M H Patil, Adv For the Respondent : Shri Ashutosh Nath, AC (AR) ORDER Per M V Ravindran These appeals are directed against Order-in-Original No. 5/2006 dated 31.01 .....

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ades, dispenser spares in terms of relevant cenvat Credit Rules. The appellant availed CENVAT Credit of duty paid such as goods, cascades which are used for transportation of CNG to their Daughter Booster Stations (DBS) for eventual sale during the period March, 01 to Dec, 04. Revenue authorities were of the view that the CENVAT Credit cannot be availed on cascade without bottle or cylinders which are mounted on vehicles as the DBS cannot be considered as manufacturing premises or factory. A sho .....

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d also imposed penalties. 3. Learned Counsel appearing on behalf of the appellant after taking us through the show-cause notice and the Order-in-Original submits that the adjudicating authority has erred in confirming the demand. It is his submission that the product manufactured by them i.e. CNG is volatile in nature and had to be transferred in cascades to DBS, where they are filled into individual vehicle. It is his submission that there is no dispute as to the credit availed on capital goods .....

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draw our attention to Chapter Note 5 under Chapter 27 which indicates that "process of compression of natural gas (even if it does not involve liquefaction), for the purpose of marketing, it is Compressed Natural Gas (CNG), for use as a fuel or for any other purpose, shall amount to manufacture" and submit that unless the CNG is further re-compressed in DBS, the product could not be filled in the vehicles hence will not attain marketability. He would submit that compression of CNG is c .....

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manufacturers, single registration and CENVAT Credit availability is permitted. He would relied upon the decision of the Hon'ble Supreme Court in the case of Vikram Cement - 2006 (197) ELT 145 (SC) for the proposition that capital goods used away from the factory premises, CENVAT Credit can be availed. He would submit that for the same reason he relies upon the judgment of the Tribunal in the case of Commissioner of Central Excise, Visakhapatnam vs. Birla Pericalse - 2014 (314) ELT 790 (Tri- .....

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r the period April, 04 to Dec, 04 is within the time but was issued first would mean that Revenue was aware to the facts and hence second show-cause notice dated 27.10.2005 is blatantly hit by limitation. He would submit that the appellants have filed regular returns with the authorities. 4. Learned AR reiterates the findings of the adjudicating authority as well as first appellate authority. 5. We have considered the submissions made by both sides and perused the records. 5.1 The issue involved .....

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ase of the appellant that DBS are installed at factory premises while the Revenue authorities are stating that DBS though registered cannot be factory premises. Another argument of the appellant is that the CNG unless compressed at DBS cannot be marketed, while it is the contention of the Revenue that it is not so. 5.2 We find on perusal of records that the contentions raised by the learned Counsel for the appellants are devoid of merits for more than one reason:- (i) Firstly, it is undisputed t .....

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sors into the vehicles. In our considered view these cascades are only transporting the CNG which has already come into existence as a manufactured product and is a marketable commodity. The argument of the learned Counsel that the CNG needs recompression into DNS in order to fill the product into vehicle is without any merits inasmuch CNG is already a marketable commodity, and the activity of recompression is neither incidental nor ancillary for manufacture of CNG at DBS as the recompression is .....

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