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2019 (7) TMI 255

..... T:- There is no dispute that the subject goods ‘MS plates’ has been used for repair or maintenance of HEMMs used in the coal mines of the appellant. The definition of term ‘input’ as defined in the CCR, 2004, includes all goods used in the factory of production unless specifically excluded therefrom. Neither of the exclusion clauses provided in the definition of term ‘input’ under Rule 2(k) is attracted in the instant case. In the instant case, the subject inputs have not been used for construction of any building or structure/foundation for support of capital goods, but for repair and maintenance of coal handling plant and HEMM’s. The usage of subject goods is very integral to the mining activity i .....

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..... he coal mines. Show Cause Notice dated 9th May, 2016 was issued to disallow the credit which culminated into Order-in-Original dated 30.12.2016 wherein it was held that the MS Plates used in mines for repairs cannot be said to be input inasmuch as there is no relationship with the manufacture of the final product. Credit was accordingly denied and demand was confirmed with equal penalty and interest. In appeal, the adjudication order has been upheld and the appeal was rejected. Hence, the present appeal before the Tribunal. 3. Sri Rajeev Kr. Agarwal, CA, appearing for the appellant submitted that the subject goods M S plates has been used for repair or maintenance of Heavy Earth Moving Machinery (HEMMs) used in the coal mines of the appella .....

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..... erred to the decision in another case of SECL vide Final Order no. 50014/2016 dated 05.01.2016 by Delhi Bench, wherein it was held that assessee is eligible for credit on various steel items (TIS Gog, Moulded Sleepers, etc) used in underground mines without which mining is not possible. It has been clearly held that such goods are not excluded from the definition of input as per CENVAT Credit Rules, 2004. He further submitted that in another case of SECL, Jamuna Kotma Area, the Ld. Commissioner (Appeals), Raipur has allowed the appeal of assessee vide Order-in-Appeal dated 15.02.2018 holding that the steel items i.e. MS Plate, TMT Rod, G.I.Pipe, Channel, HR/MS Plate, HR Sheet etc used in mines are eligible for credit. He also submitted that .....

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..... appellant is not entitled for credit and accordingly prayed that the appeal be rejected. 5. Heard both sides and perused the appeal records. 6. In the instant case, the short issue that arises for consideration is whether the appellant is eligible to avail CENVAT credit of central excise duty paid on MS Plate used in repair and maintenance of capital goods. I find that there is no dispute that the subject goods MS plates has been used for repair or maintenance of HEMMs used in the coal mines of the appellant. I find that the definition of term input as defined in the CCR, 2004, includes all goods used in the factory of production unless specifically excluded therefrom. Neither of the exclusion clauses provided in the definition of term inp .....

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..... e CBEC in Circular no. 943/04/2011-CX dated 29.04.2011 in serial no. (3) has clarified as below:- Credit of all goods used in the factory is allowed except in so far as it is specifically denied. The expression no relationship whatsoever with the manufacture of a final product must be interpreted and applied strictly and not loosely. The expression does not include any goods used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not. Only credit of goods used in the factory but having absolutely no relationship with the manufacture of final product is not allowed. Goods such as furniture and stationary used in an office within the factory are goods used in the .....

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