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CCE, Tirupathi Versus M/s. Sri Sai Sindhu Industries Ltd.

2016 (8) TMI 484 - CESTAT HYDERABAD

Cenvat credit - Irregular availment of Cenvat credit - steel items namely MS angles, HR plates, HR sheets, beams, MS joists etc. used for supporting structures to capital goods - Held that:- it is crystal clear from the invoices that the supply of goods are parts of boilers. The circulars also have clarified that the items used for support structure of such boiler/capital goods are eligible for credit. There is no evidence adduced by the department to show that the boiler can function without th .....

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lls for no interference. - Decided against the Revenue - Appeal No. E/2519/2012 - Dated:- 2-2-2016 - Ms. Sulekha Beevi, C.S., Member ( Judicial ) Shri R. Sekhar, Authorised representative for the appellant Shri P. Dwarakanath, Consultant for the respondent ORDER [ Order per: Sulekha Beevi, C.S. ] Revenue has filed this appeal challenging the order passed by Commissioner(Appeals) which set aside the demand, interest and penalty imposed alleging irregular availment of credit. 2. The respondents .....

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he Central Excise Act, 1944. The respondents carried the issue in appeal and the Commissioner(Appeals) vide the order impugned herein, the Commissioner set aside the demand, both on merits as well as on the ground of limitation. Being aggrieved, the Revenue has preferred the present appeal. 3. On behalf of the Revenue, the learned AR strongly contended that the various items like MS angles, HR plates, HR sheets, beams, MS joists etc. were used by the respondent for supporting structures. He adve .....

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ed in the factory. Further that respondent vide their letter dated 20/05/2010 have stated that the materials were used for support structure to the capital goods. That respondents suppressed these facts and that therefore the demand raised invoking the extended period is sustainable. He argued that Commissioner(Appeals) has erred in allowing credit holding that these materials are used for fabrication of essential structure/part of capital goods. In addition, it is submitted that the supplier of .....

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t though department relies upon the report of Range Officer to contend that these materials were used for supporting structures and foundation for machinery etc; no such report of Range Officer is placed as part of records. In the letter dated 20/05/2010, the appellants have stated that the steel materials were used for construction of support structure to capital goods. They also produced photographs and invoices. The photographs would show that these steel items are used for manufacture of par .....

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and the admissibility of credit on these structural items. It is stated in this circular that those structural components which are to be used essentially as a part of boiler system would be classifiable as parts of boiler only under Heading 8402 of CETA, 1985. It is further clarified that these structural components are nothing but the parts and accessories of boiler and that they would be covered by the definition of inputs under Rule 2(k)(ii) of CENVAT Credit Rules, 2004. That these structura .....

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oiler, but that credit is not admissible in respect of structural components used for laying foundation or making structures for support of capital goods. These two circulars definitely bring out one fact i.e. boiler consists of components which are in the nature of structural support which are essential parts of the boiler. The circular dated 18/05/2012 makes it very clear that only when the impugned items are used for laying foundation or structural supports, the credit would not be admissible .....

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