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TMI Blog2025 (2) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... course of Audit of records of the appellant for the period up to March 2013, it was noticed that the appellant was availing Cenvat Credit on input, capital goods and input services used in providing such output service. In the financial year 2011-12, the appellant had availed Cenvat Credit of 50% of excise duty paid i.e. Rs.1,08,81,376/- on 41 dumpers as Capital Goods and remaining 50% amount of Cenvat Credit was availed in the month of April, 2012. From 22.6.2010, the Cenvat Credit on dumper or tipper falling under Chapter Heading 87 and its component were available to output service provider providing service of site formation and clearance, excavation, mining service subject to condition that such dumpers or tippers are registered in the name of service provider. On scrutiny of the documents provided by the appellant during audit, it was revealed that the subject dumpers/tippers on which credit was availed by the appellant, were received from M/s SREI Equipment Finance Pvt. Ltd. (SEFPL) under operating lease agreement and reportedly at the relevant period registered in the name of the said company (SEFPL) and not in the name of the appellant who was providing output service. Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant period. What the law requires is use of capital goods for the purpose of manufacture. The same has not been disputed by Revenue and mandate of the statute is that capital goods should be installed in a factory or in the premises of the provider of output service, for allowance of Cenvat credit on the capital goods. Such essential condition was satisfied. Therefore, denial of Cenvat credit on the capital goods to appellant is uncalled for Ld. counsel further submitted that since dumpers/tippers fall under the category of "Capital Goods" after the amendment in 2010, the issue that "capital goods are eligible for cenvat credit" has been dealt in favour of appellant by following decisions:- * Vikram Cement vs. Commissioner of Central Excise, Indore [2006 (197) E.L.T. 145 (S.C.)] * Madras Cements Ltd. vs. Commissioner of Central Excise, Chennai [2010 (257) E.L.T. 321 (S.C.)] * Commissioner of Central Excise, Bhopal Vs. Hindustan Copper Ltd [2016 (342) E.L.T. 282 (Tri. Del.)] It is the case of the appellants that ownership of goods is not a criterion for denial of credit on capital goods and even if it is leased for a particular period, the assessee/appellant is elig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant cannot be granted benefit of the same as Rule 2(a) of the CCR, 2004, specifically contends that the registration of the dumper/tippers (which fall into the category of capital goods) should be in the name of the output service provider. The ld. Counsel contended that liberal interpretation should be accorded where there are two inconsistent statutory Rules. Also more accord should be given to the colour of the content and the context of the statute rather than with its literal meaning. The amendment in the definition of capital goods w.e.f. 22.06.2010 resulted in confusion regarding the eligibility of CENVAT Credit on capital goods not registered in the name of the output service provider whereas Rule 4(3) of CCR, 2004, clearly stated that "The CENVAT credit in respect of the capital goods shall be allowed to a manufacturer, provider of output service even if the capital goods are acquired by him on lease, hire purchase or loan agreement, from a financing company."It is pertinent to mention herein that the appellant had acquired the capital goods, vis-à-vis, dumpers/tippers, on lease from a financing company and as always it was their bonafide belief that they w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in clause (C) was inserted. In the CENVAT Credit Rules, 2004, in rule 2, in clause (a), after sub-clause (B), the following sub-clause was inserted, namely:- " (C) dumpers or tippers, falling under Chapter 87 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), registered in the name of provider of output service for providing taxable services as specified in sub-clauses (zzza) and (zzzv) of clause (105) of section 65 of the said Finance Act. Further vide Notification No. 3/2011-Central Excise (N.T.) dated 01.03.2011, effective from 01.04.2011 Rule 2(k) was substituted as under which does not allow credit of any motor vehicle as input. 5. Ld. AR further submitted that the decisions cited by the appellant are not relevant to the present case in as much as the said decisions were with reference to erstwhile provisions of Cenvat Credit Rules, 2004 i.e. prior to 22.06.2010 and the impugned show cause notice is issued in respect of cenvat credit availed w.e.f 22.06.2010 by the appellant on Dumpers and Tippers as provided in notification No. 25/2010 dated 22.06.2010. In terms of the said Notification, the definition of capital goods in clause (C) was inserted wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to availment of Cenvat Credit on Dumpers/Tippers prior to 22.06.2010 is no more res integra. The Ld Counsel has relied on the decision of Commissioner of Central Excise, Bhopal vs Hindustan Copper Ltd [2016 (342) ELT 282(Tr. Del)] in the regard. We also note that this Tribunal in the case of Commissioner, C.Ex & CGST, Delhi-III vs Brahmaputra Infrastructure Ltd., in Service Tax Final Order No. 52459/2018 dated 06/07/2018has held as follows:- "7. The limited point in appeal is regarding the eligibility of Cenvat credit for tippers/dumpers. Though the Department issued show cause notice proposing to deny such credit, the Adjudicating Authority has allowed the benefit of Cenvat credit both on merits as input under Rule 2 (k) as also on limitation. 8. We note that the issue of eligibility of Cenvat credit on tippers and dumpers already stand decided on merit in favour of the respondent by this Tribunal in the case of Soumya Mining Ltd. (supra), in which the Tribunal has observed that :- "6. There is no dispute about the fact that earth moving equipments such as dumpers are being used by the appellant to provide output service. We are of the view that dumpers even if cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers/tippers following the Apex Court decision in the case of Belani Ores Ltd. Etc. vs. State of Orissa Etc. [1975 AIR 17, 1975 SCR (2) 138 ]. However, once a specific provision had been inserted in the Cenvat Credit Rules, 2004, it would have to be given a strict interpretation. In the present case, we note that the dumpers/tippers on which Cenvat credit had been availed, was not registered in the name of the appellant, as it was in the name of SREI Equipment Finance Pvt Ltd. As the aforesaid notification clearly laid down that such credit could be availed only if the dumpers/tippers were registered in the name of the service provider, the same was not available to the appellant. We rely on the decision of Hon'ble Supreme Court in the case of Commissioner of Cus (Import), Mumbai vs Dilip Kumar & Company [2018 (361) ELT 577 (SC), wherein the it was held that statute has to be construed according to the intention of the Legislature. The Court went on to hold that Words in a statute when clear, plain and unambiguous, only one meaning can be inferred. The relevant paras are reproduced hereinafter:- "41. After thoroughly examining the various precedents some of which were cited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x or person liable to pay tax. That is why it is often said that subject is not to be taxed, unless the words of the statute unambiguously impose a tax on him, that one has to look merely at the words clearly stated and that there is no room for any intendment nor presumption as to tax. It is only the letter of the law and not the spirit of the law to guide the interpreter to decide the liability to tax ignoring any amount of hardship and eschewing equity in taxation. Thus, we may emphatically reiterate that if in the event of ambiguity in a taxation liability statute, the benefit should go to the subject/assessee. But, in a situation where the tax exemption has to be interpreted, the benefit of doubt should go in favour of the revenue, the aforesaid conclusions are expounded only as a prelude to better understand jurisprudential basis for our conclusion. We may now consider the decisions which support our view." 11. We also note that vide Notification no. 3/2011-CE(NT) dated 01.03.2011, Rule 2(k) of the Cenvat Credit Rules was amended to disallow credit on any motor vehicle as input. Therefore, we are in agreement with findings in the impugned order in this regard. As regards in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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