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2005 (3) TMI 666 - AT - Central Excise
Issues:
Appeal against denial of Modvat credit for Screw Conveyor in relation to pollution control equipment. Analysis: The appellant contested the denial of Modvat credit for the Screw Conveyor used as part of pollution control equipment essential for cement manufacturing. They argued that pollution control equipment, including the Screw Conveyor, falls under the definition of capital goods as per Rule 57Q of Central Excise Rules during the relevant period. The purpose of the pollution control equipment is to prevent pollution by retaining dust and cement particles. The Screw Conveyor is integral to this process, transferring collected particles to the plant for cement production. The appellant asserted their entitlement to Modvat credit based on this usage. The Revenue, however, opposed the appellant's claim, stating that while pollution control equipment is considered capital goods, its components, parts, and accessories do not fall under this definition. Consequently, they justified the denial of Modvat credit for the Screw Conveyor. Despite this argument, the Revenue did not dispute the Screw Conveyor's function in extracting dust particles from the pollution control system. Upon review, the Tribunal acknowledged the undisputed use of the Screw Conveyor with pollution control equipment to extract dust particles. Citing the classification of the Screw Conveyor under Heading No. 84.21, the Tribunal referred to Rule 57Q, which includes goods under Chapter 84, including 84.21, used in the manufacturing factory as eligible for capital goods credit. Given the Screw Conveyor's integral role in pollution control equipment, which qualifies for capital goods credit, the Tribunal allowed the appeal in favor of the appellant. The judgment, delivered on 14-3-2005, emphasized the compatibility of the Screw Conveyor with pollution control equipment, leading to the grant of Modvat credit based on the provisions of Rule 57Q and the classification of the equipment under Chapter 84.
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