TMI Blog2005 (10) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... the case of Jawahar Mills Ltd. [2001 (132) E.L.T. 3 (S.C.)] held that the language used in the Explanation (1) of the Rule is very liberal. If any of the items enumerated in Explanation 1(a) and 1(b) is used for any purpose mentioned therein for the manufacture of final products, it would satisfy the test of capital goods. The Court further held that the goods specified in Explanation 1(c) need not be used in the manufacture of final product. The only requirement is that they should be used in the factory of production. Question whether an item falls within the definition of capital goods would depend upon the use it is put to. Further the Tribunal in the following cases namely Reliance Industries Ltd. [2004 (178) E.L.T. 329 (T) = 2004 (63) RLT 545, Pennar Aluminium Co. Ltd. 2003 (57) RLT 724, Sirpur Mills, Simbhaoli Sugar Mills Ltd. [2001 (135) E.L.T. 1239 (T) = 2000 (39) RLT 686], New J.K Cement Works [1999 (113) E.L.T. 428] and Adarsh Industries [2002 (147) E.L.T. 407 (Tribunal) = 2001 (46) RLT 367] has held that the benefit of capital goods cannot be denied on the ground that a particular item is not directly contributing towards production of goods. Nuts and bolts used in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redit on the grounds stated above ." 2 2 For the reasons submitted in para 12 to 16 supra. SPM is eligible for capital goods credit. Hence, pans and components of SPM are also eligible for credit under Explanation 1(b) to Rule 57Q." 6. We have carefully considered these submissions. 7. The issue before the Supreme Court in Birla Corporation Ltd. [2005 (186) E.L.T. 266 (S.C.) = 2005-TIOL-99-SC is whether duty paid on spares of rope-way used for the purpose of transporting crushed lime stone from the mines located 4.2 kms. away from the factory are entitled to Modvat credit or not. The Hon'ble Supreme Court while allowing the appeal followed its earlier decision in the case of J.K. Udaipur Udyog [2005 (183) E.L.T. A159] approving Tribunal's decision in 2002 (147) E.L.T. 996. The Tribunal in J.K. Udaipur followed their earlier decision in Pepsico Holdings [2001 (130) E.L.T. 193]. It has to be seen as to what the Tribunal held in J.K. Udaipur Udyog. In para 4 of J.K Udaipur Udyog the Tribunal ruled :- "……we note that similar issue came up before the Tribunal in the case of CCE, Chennai v. Pepsico (India) Holding (supra) in which it was held that Modvat credit as capital goods wil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... except on items listed at Sl. No. 40 and 41 in the annexure are not eligible for Modvat credit. The rest of the items in dispute in E/590 are eligible for Modvat credit as capital goods. In other words, appeal E/590/99 is partly allowed to the extent indicated above. Statement showing details of credit disallowed by Commissioner (Appeal) - 4 Appeals Sr. No. Description of Capital Goods Tariff CG-87 E/591 CG-91 E/592 CG-92 E/590 CG-95 E/589 Total 1 Hard Flat round washers, HEX RD bolt with nuts, bolt with one nut, foundation nuts bolts, washers bolts, foundation bolts, coupling - complete metaflex, nut bolts, Studs Nuts, Anchor bolts, H.T. Bolts Nuts, High tensile bolts, bult 'J' type stud w/q nut 7318.10(9801.00)7318.11(9801.00)7318.00 7318.29 8483.00 7318.15 7318.90 7318.50 2 20 083 23 02 414 42 21 451 27 05 402 94 49 350 2 Absorbent (Molecular Sieves) 9801.00 15 96 393 15 96 393 3 Anodes with accessories (for cathodic protection systems) 8108.00 9 59 891 9 59 891 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 66 458 17 Boiler Components, W. Beam 8402.00 62 142 62 142 18 Earthing Strips 7308.90 58 822 58 822 19 BSD 100 Module 2100 P capacity for fire detection alarm 8531.00 57 766 57 766 20 Insulyte - 7 3816.00 51 042 51 042 21 Industrial Centrifugal Fan 8414.80 44 854 44 854 22 Jointing Kits 8544.00 43 927 43 927 23 Flameproof/Explotion proof apparatus/Equipments 8668.00 38 668 38 668 24 Damper 7308.90 15 730 22 258 37 988 25 Main lighting distribution, switch socket spare parts 8537.00 8537.38 36 672 36 672 26 Components of Air Handling unit (AHU) - Dampers, Doors, Louvars, door (Steel door log AHU) 7306.90 8479.20 7308.90 8479.00 36 519 36 519 27 Lower structure upper structure ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
