2009 (3) TMI 908 - AT - Central Excise

Summary

Issues involved:
The issue involves the availability of Cenvat credit on duty paid for 'Fixed Facility Charges' related to storage tanks used in the manufacturing process of bulk drugs.

Summary:

Issue 1: Availability of Cenvat credit on 'Fixed Facility Charges'
The appellants, manufacturers of Bulk Drugs, availed Cenvat credit on duty paid for liquid nitrogen used in manufacturing final products. They also paid 'Fixed Facility Charges' for special storage tanks and claimed Cenvat credit on the duty paid. The department contended that these charges do not have a nexus with the gas supplied and cannot be considered duty paid on inputs or capital goods. The adjudicating authority disallowed the credit, relying on a Supreme Court decision. The Commissioner (Appeals) set aside the order, stating that if duty liability is discharged by the supplier, the credit is valid. The Tribunal upheld this decision, emphasizing that the discharge of duty liability and issuance of invoices entitle the respondent to avail Cenvat credit.

Decision:
The Tribunal found no merit in the Revenue's appeal and rejected it, upholding the decision to allow Cenvat credit on the duty paid for 'Fixed Facility Charges' related to storage tanks used in the manufacturing process of bulk drugs.