TMI Blog2017 (10) TMI 788X X X X Extracts X X X X X X X X Extracts X X X X ..... e possible. Thus the view of Commr. (A) holding Diesel locomotive as accessory of capital goods is upheld and credit allowed - credit allowed. Penalty on General Manager - availment of irregular credit - Held that: - Since the main appeal involving locomotive and parts thereof is allowed , consequently appeal of the General Manager against the penalty is also allowed. Appeal allowed - decided in favor of appellant. - E/3316/2012-SM, E/21127/2015-SM, E/22513/2014-SM, E/22524/2014-SM - Final Order No. 21330-21333 / 2017 - Dated:- 28-7-2017 - Shri S. S. Garg, Judicial Member Shri M.V. Sridhar Consultant For the Appellant Shri Pakshirajan, Asst. Commissioner (AR) For the Respondent ORDER Per : S.S. Garg These 4 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of Section 11AC of the Central Excise Act, 1944 was also imposed. Aggrieved by the Order-in-Original, the appellant filed the appeal before the Commissioner(Appeals who also rejected the appeals and hence the present appeals. 4. Heard both the parties and perused records. 5. Learned counsel for the appellant submits that the impugned orders are not sustainable in law as the same has been passed by misconstruing the definition of capital goods and the input and further the impugned orders are contrary to the binding judicial decisions on the same issue. He further submitted that the appellant used locomotives in the factory premises as material handling equipment for shifting, transferring, transportation of the raw materials and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts Ltd. Vs. CCE, Cochin [2002(149) ELT 751 (Tri. Bang.)] ix. Commissioner Vs. Malabar Cements Ltd. [2003(153) ELT A94(SC)] 6. He also submitted that the Division Bench of the Tribunal in the case of Bhusan Steel Ltd. cited supra has specifically held that the assessee is entitled to the CENVAT credit of duty paid on diesel locomotives used within the factory to carry molten metal torpedo ladle car in the process of manufacturing of iron and steel products in the integrated steel plant having railway sliding within the factory premises and laid down lines within the factory connecting one plant to another plant for movement of raw material, semi-finished and finished goods. He also submitted that in the case of Aditya Cement cited s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been mentioned, we are of the considered view that the dumpers as such are accessory to the capital goods involved in manufacture of final products. 6.1 CESTAT, Delhi in the case of Jindal Steel Power Ltd. (supra) have held that 'transfer vehicles' used within the factory are eligible for cenvat credit. CESTAT in this case in respect of such vehicles observes as under:- 8. They are not transfer vehicles or trucks for common public transport of goods. As admitted in the proceedings, they are specially designed for industrial purpose and the sic operate within narrow scope of factory premises. In the case of Bhusan Steel Ltd. (supra), this Tribunal held that diesel locomotive torpedo ladle car carrying molten metal not on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 57Q of erstwhile Central Excise Rules, 1944. Hon'ble Rajasthan High Court in this case , inter alia, observes as under:- 19. We are of the opinion that the principle emerging from decisions of the Hon'ble Supreme Court and of this Court applies to the present case also. In the light of the aforesaid principle, if we take into account the use of iron and steel ingot as parts and components of its machinery used in manufacturing Cement, Railway Track materials needed for transporting fuel as essential for manufacturing in the plant, it is clear that so far as the items of iron and steel are concerned, they are used as providing parts and components of the plant and machinery and becomes essential elements of the machine itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deliverable state, it remains part of the manufacturing process. In view of this matter the claim of the assessee in respect of Modvat credit of duty paid on railway track material deserves to be sustained. 8. In the light of the discussion made above and by following the ratio of the Bhusan Steels Ltd. and Aditya Cement cited supra, I am of the view that the impugned order denying the CENVAT credit on locomotives and spare parts of the locomotives is not sustainable in law and therefore I set aside the same by allowing the appeal of the appellant with consequential reliefs. Since the main appeal involving locomotive and parts thereof is allowed , consequently appeal of the General Manager against the penalty is also allowed. 9. Al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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