2016 (8) TMI 349 - AT - Central Excise

Cenvat credit - availability - duty paid on various iron and steel items used for fabrication of capital goods - Held that - the issue stand covered by the recent decision of Hon ble High Court of Gujarat in the case of Mundra Ports & Special Economic Zone Ltd. vs. CCE & Cus 2015 (5) TMI 663 - GUJARAT HIGH COURT and by the precedent decision of same assessee s case. Therefore, in any case, even if the said items are held to be used as supporting structures, the cenvat credit cannot be denied. - Decided against the revenue

Summary

Issues Involved:
Availability of Cenvat credit on duty paid iron and steel items used for fabrication of capital goods.

Analysis:
The dispute in the present appeal revolves around the availability of Cenvat credit on duty paid iron and steel items used for the fabrication of capital goods like kilns, electrification, power plants, and conveyor systems. The appellate authority, after considering various Tribunal decisions, concluded that the items in question are eligible for Cenvat credit as they were used in the fabrication of capital goods.

The respondent's advocate highlighted a previous Tribunal decision in the same assessee's case, where relief was granted regarding the same iron and steel items. Reference was also made to a recent High Court decision that disagreed with the Tribunal's denial of credit on similar items used as structurals. The advocate argued that the steel items were used for supporting structures of various parts of kilns, emphasizing the relevance of previous decisions in favor of the assessee.

However, the Revenue's representative contended that the issue in the current appeal differs from the earlier case as the disputed goods were used as supporting structures for the capital goods, unlike in the previous instance where they were considered either capital goods themselves or components/parts of such goods. The representative argued that the steel items were used for construction of support structures or foundations for machine installation, which, in their view, was not covered by the previous Tribunal decision.

The Tribunal, after reviewing the earlier order in the same assessee's case, found that it dealt with the identical issue of using iron and steel items for the fabrication of kilns. Therefore, the Tribunal concluded that the earlier order favored the assessee on the issue at hand. Additionally, the Tribunal noted that even if the items were considered as supporting structures, the dispute was covered by a recent High Court decision, which the Revenue's representative disagreed with.

The Tribunal emphasized that the hierarchy of the Judiciary system mandates the acceptance and application of decisions from Higher Courts. As the issue had been settled by the High Court, it was not open for the Revenue's representative to dispute or disagree with the High Court's decision. The Tribunal upheld the law declared by the High Court and found no reason to interfere with the Commissioner (Appeals)'s order, ultimately rejecting the Revenue's appeal.

In conclusion, the Tribunal's decision was based on the interpretation of previous Tribunal and High Court decisions, emphasizing the binding nature of High Court rulings on lower Courts and Tribunals. The Tribunal's analysis focused on the specific use of iron and steel items for the fabrication of capital goods and the applicability of relevant legal precedents to the case at hand.