2016 (8) TMI 1110 - AT - Central Excise

Cenvat credit - welding electrodes - they are general purpose items used in various work shops of the appellant and, as such, has no connection with their manufacturing activity - Held that - the issue has been settled in favour of the Assessee in various judicial pronouncement which are being followed by the Tribunal. By applying the decision of Tribunal in the case of Lafage India Pvt. Ltd. vs. CCE, Raipur 2016 (8) TMI 1012 - CESTAT NEW DELHI and in the case of Mangalam Cement Ltd. vs. CCE, Jaipur - I 2016 (8) TMI 593 - CESTAT NEW DELHI by following the decision of Hon ble Chhattisgarh High Court in Ambuja Cements Eastern Ltd. vs. CCE, Raipur 2010 (4) TMI 429 - CHHAITISGARH HIGH COURT , i find no merit in the denial of credit on these welding electrodes, so the impugned order is not sustainable on this issue. Cenvat credit - light fittings - these high-bay lighting systems were mounted on civil structures to illuminate the factory premises - Held that - the admitted fact is that they are classified under the eligible Chapter Heading (Chapter 84, 85 and 9405) of the Tariff and are used by the manufacturer in the factory of manufacture. The items are light structures, lamps, high mast light, tubes/glass and fixtures. The eligibility for credit is thus satisfied. I find no substance in the reasoning of the Original Authority regarding light fittings becoming part of civil structure. I find this by itself is not a ground for denial of credit. Admittedly the various light fittings and fixtures were brought into the factory after duty payment and were installed for the intended purposes. To call these items as immovable property is without basis. These goods are used within the building premises, mills and shops to enhance illumination. This enables round the clock operation of the assessee. - Decided in favour of appellant

Summary

Issues:
- Denial of Cenvat credit on welding electrodes
- Denial of Cenvat credit on lighting fixtures and equipments

Analysis:

Denial of Cenvat credit on welding electrodes:
The appeal challenged the denial of Cenvat credit amounting to Rs. 34,26,036/- by the Commissioner of Central Excise, Raipur. The Commissioner disallowed credit on welding electrodes and lighting fixtures, claiming they were general purpose items with no direct connection to the manufacturing activity. However, the appellant argued that welding electrodes qualify as inputs under Rule 2(k) of the Cenvat Credit Rules, 2004. They contended that welding electrodes were used for fabrication of capital goods and repair and maintenance activities. The appellant cited various judicial pronouncements supporting the eligibility of welding electrodes for Cenvat credit. The Tribunal agreed with the appellant, citing precedents and held that the denial of credit on welding electrodes was not justified.

Denial of Cenvat credit on lighting fixtures and equipments:
Regarding the denial of Cenvat credit on lighting fixtures, the appellant argued that the items were classified under eligible tariff headings and were used within the manufacturing premises. The appellant contended that the lighting fixtures were not immovable assets but essential for operations. The Authorized Representative opposed the appellant's submissions, stating that the lighting fixtures had become part of civil structures and could not be considered as capital goods. The Tribunal disagreed with the lower authority's reasoning and found that the lighting fixtures were appropriately classified and used within the factory for operational purposes. The Tribunal concluded that the denial of credit on lighting fixtures was unfounded and allowed the appeal on this issue as well.

In conclusion, the Tribunal set aside the impugned order related to the denial of Cenvat credit on welding electrodes and lighting fixtures. The appeal was allowed, emphasizing the eligibility of welding electrodes as inputs and the classification and usage of lighting fixtures within the factory premises for operational purposes.