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M/s. Kirloskar Ferrous Industries Ltd Versus Commissioner of Central Excise, Customs and Service Tax, Belgaum

2017 (10) TMI 613 - CESTAT BANGALORE

CENVAT credit - inputs/capital goods - MS angles, channels, joists, beams, etc. - the said items used for manufacture of capital goods, viz., fabrication / manufacture of hot blast stoves - Held that: - the issue in the present appeal is covered by the decision in the case of CCE vs. SLR Steels Ltd. [2012 (9) TMI 169 - KARNATAKA HIGH COURT] decided by the Hon’ble Karnataka High Court, where it was held that Once a storage tank and pollution control equipment constitutes capital goods and any raw .....

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1-10-2017 - Shri S. S. Garg, Judicial Member Mr. M.S. Nagaraja, Adv For the Appellant Mr. Parasivamurthy, AR For the Respondent ORDER Per : S. S. Garg The present appeal is directed against the impugned order dated 19.5.2017/24.5.2017 passed by the Commissioner (A), whereby the Commissioner (A) has rejected the appeal of the appellant. 2. Briefly the facts of the present case are that the appellants are engaged in the manufacture of pig iron and unmachined castings falling under Chapter 72 and 7 .....

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ation / manufacture of hot blast stoves. It appeared that the credit availed on the said items is irregular inasmuch as these items are neither inputs nor capital goods. As the appellants did not reverse the irregular credit, show-cause notice was issued proposing to deny the credit, demand of interest on irregular credit and proposal to impose penalty. Accordingly, the lower authority referring to the decision in the case of M/s. Bajaj Hindustan Ltd. Vs. CCE, Meerut: 2012 (284) ELT 565, M/s. U. .....

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After considering the submissions of both the parties, the Commissioner (A) has rejected the appeal of the appellant and hence, the present appeal. 3. Heard both the parties and perused the records. 4. Learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same has been passed beyond the show-cause notice and also contrary to the binding judicial precedent. He further submitted that in the show-cause notice, the Department has admitted that these ite .....

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notice has specifically stated that the assessee had used MS angles, plates, joists, channels, beams for fabrication of hot blast stove and the assessee in their reply has submitted that the hot blast stove are classifiable under Chapter Heading 8414 5930 of CETA, 1985 which has not been controverted by the Revenue. He further submitted that the inputs used for fabrication / manufacture of capital goods which are further used in the factory are eligible for CENVAT credit in terms of Explanation .....

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ixed to earth for operations are goods and not immovable property. In support of his submission that the plants and machineries fixed to earth are goods and not immovable property. He relied upon the following decisions: Sirpur Paper Mills Ltd. Vs. CCE, Hyderabad: 1998 (97) ELT 3 (SC) CCE, Ahmedabad Vs. Solid & Correct Engineering Works: 2010 (252) ELT 481 Mahindra & Mahindra Ltd. Vs. CCE: 2005 (190) ELT 301 (Tri.-LB) 5.1 He further submitted that the inputs used for fabrication of capit .....

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under: 8. To decide the issue whether these manufacturing facilities are to be considered as immovable property or as capital goods, it is useful to refer to the clarification issued by CBEC vide order No.53/2/98-CX dated 2.4.1998 in which the excisability of plant and machinery assembled at site has been clarified. The Board has referred to the decision of the Hon ble Supreme Court in the case of Sirpur Paper Mills Ltd. [1998 (97) ELT 3 (SC)] and has prescribed the following broad criteria to b .....

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mmovable property, if the whole purpose behind attaching to a concrete base is to secure maximum operational efficiency and safety. iv. It can be sold in the market. It would be treated as marketable even though it may have to be removed from its base and dismantled, before being sold. 9. The claim of the appellant which has been explained in the above paragraph is that these manufacturing facilities find place specifically in the Central Excise Tariff. Both blast furnace and coke oven batteries .....

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n of the Hon ble Supreme Court cited supra, we find that the apex court has excluded only things of the type such as building or tree which get fixed to the earth. We find that both blast furnace and coke oven batteries cannot be considered to be in the same category as building or tree. In view of the above discussions, it emerges that both manufacturing facilities are to be considered as capital goods. 10. We may look at the situation from another perspective. We are not deciding the excisabil .....

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sed in the fabrication and assembly at site of the manufacturing facilities. Consequently, we take the view that even if the blast furnace as well as coke oven batteries are made immovable by attaching them to the foundation for trouble free function, the eligibility for availment of CENVAT credit cannot be denied. 5.2 He further submitted that the impugned order is beyond the show-cause notice and the same is not sustainable. In support of this submission, he relied upon the following decisions .....

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n the appellant's own case for an earlier period, the Commissioner (A) vide Order-in-Appeal No.566/2012 dated 18.10.2012 allowed the appeal of the assessee and against the said order, the Revenue filed appeal before this Tribunal and this Tribunal vide Final Order No.20913-20914/2017 dated 16.2.2017 dismissed the appeal of the Revenue. He further submitted that the issue involved in the present appeal is the same as was involved in the earlier appeal filed by the Revenue, which was dismissed .....

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