2015 (3) TMI 661 - HC - Central Excise

Denial of CENVAT Credit - credit on MS Rod Sheets, M.S.Chennel, M.S.Plates, Flats etc. used in the fabrication of fly ash hooper, fly ash bin, fly ash handling system & kiln brick laying work to bold refractories - Held that - there is no change in the circumstance and this Court had already considered the issue and held that the decision reported in 2011 (8) TMI 4 - SUPREME COURT OF INDIA (Saraswati Sugar Mills V. Comissioner of Central Excise, Delhi - III) is distinguishable on facts. This Court applied the principles laid down in the decision reported in 2010 (7) TMI 12 - SUPREME COURT OF INDIA (Commissioner of Central Excise Jaipur V. Rajasthan Spinning & Weaving Mills Ltd.) and held that the Tribunal was justified in allowing the assessee s contention in respect of the very same assessee. - Decided in favour of assessee.

Summary

Issues:
1. Denial of cenvat credit on specific goods used in fabrication.
2. Interpretation of the decision in M/s.Vandana Global Ltd. and others vs. Commissioner of Central Excise, 2010 (253) ELT 440 (LB).

Analysis:
Issue 1: The appellant, a cement manufacturer, availed cenvat credit on MS Rod, Sheet, MS Channel, MS Plate, Flat etc., used in fabrication work. The Department contended these goods were not capital goods but used in construction only. The Adjudicating Authority confirmed a demand against the appellant. The Commissioner (Appeals) upheld this decision. The Tribunal, following the decision in M/s.Vandana Global Ltd., dismissed the appeal but deleted the penalty. The appellant argued that the goods were used in erecting capital goods, citing Commissioner of Central Excise, Jaipur V. Rajasthan Spinning & Weaving Mills Ltd. The Revenue contended that the goods were not capital goods under Cenvat Credit Rules, 2004. The Court noted the goods were essential for machinery function.

Issue 2: The Court referred to the decision in Commissioner of Central Excise, Jaipur V. Rajasthan Spinning & Weaving Mills Ltd., where the Supreme Court allowed MODVAT credit on similar goods for erection of machinery. The Court distinguished the Revenue's reliance on Saraswati Sugar Mills case, emphasizing factual differences. The Court dismissed the Revenue's appeal, confirming the Tribunal's decision. The Court highlighted consistency in its previous rulings on similar cases involving the same assessee. The Court allowed the appeal, setting aside the Tribunal's order based on established principles and earlier decisions.

This comprehensive analysis of the judgment addresses the denial of cenvat credit on specific goods used in fabrication and the interpretation of relevant legal precedents, ensuring a detailed understanding of the legal issues involved.