TMI Blog2018 (2) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... to avail Modvat credit thereon - credit allowed - appeal allowed - decided in favor of appellant-assessee. - Central Excise Appeal No. 24 of 2005 - - - Dated:- 12-7-2017 - Sanjay Kumar and Anis, JJ. Shri Challa Gunaranjan, for the Appellant. Shri B. Narayana Reddy, Assistant Solicitor General of India, for the Respondent. JUDGMENT [Judgment per : Sanjay Kumar, J.]. - This appeal by the assessee under Section 35G of the Central Excise Act, 1944 (for brevity, the Act of 1944 ) raises the following substantial questions of law : A. Whether in the facts and circumstances of the case the Tribunal is correct in law in holding that the H.R. Coils cannot be considered as components or accessories of the machinery so as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned counsel for the appellant-assessee, would point out that in its explanation to the show cause notice, the appellant-assessee spelt out as under : In response to the above show cause notice, we submit that the HR Coils are used for fabrication of Pipe Lines for Condensor Cooling System and Raw water pumping and circulation from KSP Canal. Cooling water piping is required for circulation of cooling water for Condensor cooling as well as other coolers. The system comprises of the mixed flow vertical circulating water pumps for the steam turbine drawing water from a sump connected to the cooling tower basin. The cooling water will be passed through condenser and the hot water will be transferred to cooling towers. For this, 800 mm a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Mills Ltd. [2001 (132) E.L.T. 3 (S.C.)] and Indian Farmers Fertilisers Co-Operative Ltd. v. Collector of Central Excise, Ahmedabad [1996 (86) E.L.T. 177 (S.C.) = (1996) 5 SCC 488]. 6. In the light of the aforestated legal position, we are of the opinion that once the appellant-assessee demonstrated before the authorities that use of the HR coils in the cooling system of the power plant was essential for its functioning, they necessarily have to be treated as part of the machinery qualifying them as capital goods. Once that is so, the appellant-assessee was eligible under Rule 57Q of the Rules of 1944 to avail Modvat credit thereon. The questions of law raised are accordingly answered in favour of the appellant-assessee and against the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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