2002 (7) TMI 454 - AT - Central Excise

Summary

Issues: Availability of Modvat/Cenvat credit under Rule 57A/57AA of Central Excise Rules, 1944 on inputs used for repairs, upkeep, and maintenance of machinery, machines, equipment, and structurals.

Analysis:
1. The issue in this appeal pertains to the availability of Modvat/Cenvat credit under Rule 57A/57AA of Central Excise Rules, 1944 on inputs utilized for repairs, maintenance, and upkeep of various machinery, machines, equipment, and structurals. The Commissioner disallowed the Cenvat credit availed by the appellants on welding electrodes, Oxygen gas, and dissolved acetylene gas used for cutting iron bars and steel, stating that these inputs were not directly or indirectly related to the manufacturing process of cement and clinker. The Commissioner relied on previous Tribunal decisions to support this disallowance.

2. The Commissioner, in his order, disallowed the Cenvat credit and confirmed the demand on the appellants under Rule 57AH read with Section 11A of the Central Excise Act, 1944. The appellants challenged this order through the present appeal. The appellants argued that a Tribunal decision in a similar case had allowed Modvat credit on inputs used for welding during repairs and maintenance, contradicting the Commissioner's stance.

3. The conflicting views on the availability of Modvat/Cenvat credit for inputs used in repairs and maintenance of machinery, equipment, and structurals under Rule 57A/57AA of the Central Excise Rules, 1944 were highlighted. Due to the disparity in opinions, the matter was submitted to the Hon'ble President for consideration of referral to a Larger Bench to resolve the differing interpretations and establish a consistent legal position on the issue.