2006 (7) TMI 542 - AT - Central Excise

Summary

Issues: Denial of credit for duty paid on 'Sulphuric Acid Catalyst' as capital goods under Rule 57Q.

The judgment revolves around the denial of credit for duty paid on a 'Sulphuric Acid Catalyst' imported by M/s. Sterlite Industries India Ltd. through Tuticorin Customs House. The catalyst is used in the Sulphuric Acid Plant to expedite the conversion of Sulphur Dioxide to Sulphur Trioxide. The original authority and the lower appellate authority rejected the claim for credit, stating that the catalyst did not participate in the manufacture of the final product but only induced a chemical reaction. The Commissioner (Appeals) noted that the catalyst was not among the goods eligible for credit under Rule 57Q.

Upon hearing both sides, the Tribunal analyzed the definition of capital goods at the relevant time, which included machines, machinery, plant, equipment, tools, or appliances used in production or processing of goods. The Tribunal highlighted that the list of eligible items covered components, spare parts, accessories, and specified goods, none of which included the Sulphuric Acid Catalyst. Referring to a previous Final Order, the Tribunal confirmed the denial of capital goods credit for the catalyst, as it did not fall within the scope of eligible goods under Rule 57Q.

Ultimately, the Tribunal upheld the decision of the lower appellate authority to deny the capital goods credit for the 'Sulphuric Acid Catalyst,' based on the lack of eligibility under Rule 57Q. The appeal was dismissed, and the operative portion of the judgment was pronounced in open court on 12-7-2006.