2016 (10) TMI 824 - AT - Central Excise

CENVAT credit - structural steel items, namely, Plates used in fabrication/laying foundation of supporting structures of the plant and machineries - Held that - the period involved for the demand is from August, 2009 to June, 2010. I find that that with effect from 07.07.2009, Explanation 2 to Rule 2(k) defining input excludes cement, angles, channels, CTD bars, TMT bars and other items used for construction of factory shed or laying of foundation or making of structures for support of capital goods from the definition of input. Here, there is no evidence on record to prove that the item steel plates have been used for construction of factory sheds or for laying foundation for support of capital goods, etc. Actually, the appellant has claimed that the subject goods, namely, MS plates have been used for repair and maintenance of chimney of dusting system of RMP hopper, coal circuit, Kiln at sponge iron division and boiler duct at power plant. It is also evident from the facts that there is no evidence to disclaim or counter the appellant s claim that these goods were used for repair and maintenance of above machinery, namely, chimney of dusting system of RMP hopper, coal circuit, Kiln at sponge iron division and boiler duct at power plant. Therefore, subject item is certainly covered within the Explanation 2 of definition of input given in Rule 2(k) of Cenvat Credit Rules, 2004. Reliance placed on the decision of case Jaipur Vs. Rajasthan Spinning & Weaving Mills Ltd. 2010 (7) TMI 12 - SUPREME COURT OF INDIA and Monnet Ispat & Energy Ltd. Vs. CCE, Raipur 2016 (1) TMI 917 - CESTAT NEW DELHI . Subject item entitled to CENVAT credit - appeal allowed - decided in favor of appellant.

Summary

Issues:
Cenvat credit on structural steel items

Analysis:
The appellant claimed Cenvat credit on structural steel items, specifically MS plates used for maintenance of various machinery. The appellant argued that the MS plates fell under the definition of capital goods as per the Cenvat Credit Rules, 2004. The Commissioner (Appeals) denied the credit, stating that the appellant failed to provide relevant supporting documents for the claimed usage of the MS plates. The Revenue supported the lower authorities' findings.

The Tribunal examined the definitions of inputs and capital goods under the Cenvat Credit Rules. Rule 2(k) defines inputs broadly, including goods used in or in relation to the manufacture of final products. However, Explanation 2 to Rule 2(k) excludes certain items like cement, angles, and bars used for construction from the definition of input. The Tribunal noted that the appellant used the MS plates for repair and maintenance of specific machinery, as evidenced by an email certifying such use. Based on this evidence and relevant case laws, the Tribunal held that the MS plates qualified for Cenvat credit.

In conclusion, the Tribunal allowed the appeal, granting consequential relief to the appellant. The judgment emphasized the importance of evidence supporting the usage of goods for claiming Cenvat credit and highlighted the applicability of relevant legal provisions and precedents in determining eligibility for such credits.

This detailed analysis of the judgment provides a comprehensive overview of the issues involved, the arguments presented by both parties, the legal framework applied by the Tribunal, and the final decision rendered in favor of the appellant.