2004 (3) TMI 673 - AT - Central Excise

Summary

Issues:
Claim for Modvat credit on duty paid on steel plates used in the manufacture of stainless steel/carbon steel welded/seamless tubes and pipes rejected.

Analysis:
The appellant's appeal challenged the rejection of the claim for Modvat credit on duty paid on steel plates used in manufacturing steel tubes and pipes. The appellant filed a declaration under Rule 57T claiming credit on these goods as capital goods. However, the lower authorities rejected the declaration, stating that the goods did not qualify as capital goods or components of capital goods. The appellant argued that the parts were used in manufacturing a "Pickling Bath," considered a capital good in their factory. Additionally, they claimed that if the goods were not considered capital goods under Rule 57T/Q, they should be eligible for credit as inputs under Rule 57G.

The submissions made by the appellant were not accepted, leading to the appeal. The dispute centered around the credit taken in May 2000. The definition of "capital goods" under Rule 57Q of the Central Excise Rules 1944 included goods falling under Central Excise Tariff Heading No. 84.19, a fact acknowledged by the revenue. The "Pickling Bath" manufactured from the steel plates, for which credit was claimed, fell under Heading No. 84.19. Therefore, as the steel plates were components of goods listed under Rule 57Q, they were deemed eligible for Modvat credit under Rule 57T/Q.

The judge noted that there were no other grounds presented to deny the credit. Consequently, it was held that the appellants were entitled to take the credit. The appeal was successful, and the orders of the lower authorities rejecting the claim were set aside.