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2016 (3) TMI 947 - CESTAT MUMBAI

2016 (3) TMI 947 - CESTAT MUMBAI - TMI - CENVAT credit denied on the condition that the capital goods so supplied by M/s. ITC Ltd. is not a financing company - Held that:- Present respondent is on a better footing as they have taken the capital goods from the principal manufacturer and against which they are paying the lease rent to the principal manufacturer. There is no dispute that the capital goods so procured on lease basis are indeed used in the manufacturer of final product on behalf of M .....

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Central Excise & Customs, Nagpur whereby the Ld. Commissioner by setting aside the Order-in-Original No. 74/CE/ADC/AKC/2008 dt. 5/12/2008 allowed the appeal of the respondent. 2. The issue involved in the fact of the present case is that the respondent acquired capital goods from their principals M/s. ITC Ltd. for carrying out the job work on behalf of M/s. ITC Ltd. on lease basis. The respondent were paying lease rent towards the use of capital goods to M/s. ITC Ltd., The show cause notice .....

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respondent filed appeal before the Commissioner (Appeals), which was allowed by the Ld. Commissioner (Appeals) relying on the judgment of German Remedies Ltd. vs. Commissioner of Central Excise, Goa 2002 (144) ELT 606 (Tri Mum) therefore the Revenue filed this appeal. 3. Shri Sanjay Hasija, Ld. Supdt. (A.R.) appearing on behalf of the Revenue reiterating the grounds of appeal, further submits that Rule 4(3) is very clear, according to which, the Cenvat credit in case of procurement of capital g .....

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ownership does not remain with the manufacturer assessee for any reason and so long the capital goods is used for manufacture of final product, credit should be allowed. He placed reliance on the judgment of Hon'ble Bombay High Court in the case of Commissioner of Central Excise, Raigad Vs. Modernova Plastyles Pvt. Ltd. 2015 (323) E.L.T. 352 (Bom.). 5. I have carefully considered the submissions made by both the sides. I find that the credit was proposed to be disallowed only on the conditio .....

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w that whether the capital goods supplied by a financing company or otherwise, it is not significant for deciding the admissibility of the Cenvat Credit. So long the capital goods was received by the respondent and used n the manufacture of goods, credit should be allowed even as per the normal provision of the Cenvat Credit Rules, 2004. On going through the Hon'ble Bombay High Court judgment in Modernova Plastyles Pvt. Ltd. (supra), I find in that case also the capital goods was given by th .....

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, sub rule 3 of Rule 57R having under gone amendment to it, removed such requirement of ownership/acquisition from financing agency. For taking credit of duty paid on said goods, it would not be necessary that capital goods shall either be owned by the assessee or those shall be acquired by finance from financing agency. Denial of credit based on such ground is unsustainable. 15. We therefore consider that having regard to the prevailing legal position applicable to the case of the respondent as .....

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ed on behalf of the respondent assessee the decision relied on behalf of the appellant revenue is of little efficacy from position emerging from decision rendered by the Supreme Court in Marmagoa Steel Ltd. (supra) and other orders passed by this Court as well as decisions of Gujrat and Punjab & Haryana High Courts. From the above judgment, it is very clear that the present respondent is on a better footing as they have taken the capital goods from the principal manufacturer and against whic .....

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ow: "17. Ld. Counsel for the appellant has further argued that the original adjudicating authority placed reliance on CESTAT Judgment in the case of M/s. Terene Fibres Pvt. Ltd. Vs. CCE, Mumbai reported as 2001 (138) E.L.T. 889 (Tri. - Mumbai) which was on limitations & not on, merits alone & distinguishable with the Hon'ble CESTAT judgment in the case of German Remedies Ltd. Vs. CCE, Goa reported as 2002 (144) E.L.T. 606 (Tri. - Mumbai) "In the case of M/s. Terene Fibres P .....

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ntimated to the Department every month. Even then the Department continued to tolerate the continued wrong availment without issuing Show-cause notice-Notices for the normal period. In the light of the knowledge of the Department, the allegation that the facts were suppressed by the assessee lacks force. For invocation of the extended period, suppression of the facts has to be "willful". Neither RIL nor appellant had claimed depreciation on the duty portion of the capital goods. On the .....

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e Fibres India, supra. According to Salmond, the ratio decidendi is the rule of law applied by and acted on by the Court, or the rule which the Court regarded as governing the case. The Supreme Court in the case of Dalbir Singh, supra, observed that the ratio decidendi may be defined as a statement of law applied to the legal problems raised by facts as found, upon which the decision is based. The Supreme Court, in the case of Krishena Kumar, observed that the ratio decidendi has to be ascertain .....

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