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2009 (10) TMI 714 - AT - Central ExciseCENVAT credit - capital goods - Ziricon Oxygen Probe - Polymer Conductivity Analiser/Censor - Cable Tray - denial on the ground that the same are not specified goods - Held that - Board s Circular dated 2-12-1996 clarifies that the components accessories of the specified goods irrespective of classification are entitled for credit - the goods in question are used as the components of the plant therefore in view of the Board s Circular relied upon by the appellants irrespective of classification the benefit is available - credit allowed - appeal allowed - decided in favor of appellant.
Issues: Denial of credit for specific capital goods.
In this judgment by the Appellate Tribunal CESTAT KOLKATA, the issue revolved around the denial of credit for certain capital goods, namely Ziricon Oxygen Probe, Polymer Conductivity Analiser/Censor, and Cable Tray. The appellants contested the denial of credit based on the argument that these goods were integral parts of the manufacturing process and plant. The Revenue, on the other hand, argued that these goods were instruments and therefore not eligible for credit. The appellants based their argument on a Board's Circular from 2-12-1996, which clarified that components and accessories of specified goods, regardless of classification, were entitled to credit. They contended that the Ziricon Oxygen Probe regulated heat in the furnace, the Polymer Conductivity Analiser controlled temperature during manufacturing, and the Cable Tray held power distribution cables, all essential for plant operations. The Tribunal analyzed the situation and determined that since the goods in question were used as components of the plant and fell within the scope of the Board's Circular, the denial of credit was unjustified. The Tribunal concluded that the benefit of credit for the mentioned capital goods should be allowed, setting aside the impugned order that denied the credit. Therefore, the judgment favored the appellants, ruling in their favor and allowing the appeal regarding the denial of credit for the specified capital goods. The decision highlighted the importance of considering the functional role of goods within a manufacturing setup when determining their eligibility for credit, as outlined in relevant circulars and regulations.
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