2016 (11) TMI 774 - AT - Central Excise

Denial of cenvat credit - certain items used in the fabrication of storage tanks platforms and pipelines - availment of the cenvat credit on these items used in the manufacture of exempted capital goods under N/N. 67/95-CE dated 16.03.1995 - Held that - The Ld. Counsel during the course of arguments have produced Chartered Engineer certificate/report which has been issued after examining the storage tank installed in the factory premises of the appellant and that Chartered Engineer report is self explanatory for usage of the items but the same has not been placed before the adjudicating authority for consideration but placed before us. In that circumstances it would be in the interest of justice to remand matter back to the adjudicating authority for denovo consideration of the issue to entitlement of the cenvat credit on steel items which is claimed by the appellant to be used in fabrication of storage tank etc. - appeal disposed off - matter on remand.

Summary

Issues:
Appeal against denial of cenvat credit on items used in fabrication of storage tanks, platforms, and pipelines.

Analysis:
The appellant, engaged in manufacturing casein and lactose, availed cenvat credit on various steel items used in the fabrication of storage tanks, platforms, and pipelines. An audit objection was raised regarding the availment of cenvat credit on these items for manufacturing exempted capital goods. The adjudicating authority denied the credit, leading to confirmation of demand and imposition of penalty. The appellant contended that storage tanks, being movable property fixed with nuts and bolts, qualify as capital goods eligible for cenvat credit under Rule 2(a) of the Cenvat Credit Rules. The appellant produced a certificate from a Chartered Engineer supporting their claim. The AR argued that the Engineer's report was unreliable as it was issued without examination.

During the proceedings, the appellant presented the Chartered Engineer's report, which was not submitted to the adjudicating authority earlier. The report detailed the examination of the storage tank at the appellant's factory, supporting the usage of the steel items in question. Considering this new evidence, the Tribunal deemed it necessary to remand the matter back to the adjudicating authority for a fresh consideration. The Tribunal set aside the impugned order and directed the authority to review the case, taking into account the Chartered Engineer's report and relevant legal precedents. The appeal was disposed of accordingly.

This judgment highlights the importance of presenting all relevant evidence before the adjudicating authority and the Tribunal. The Chartered Engineer's report played a crucial role in supporting the appellant's claim for cenvat credit on the steel items used in the fabrication of storage tanks. The decision to remand the matter for fresh consideration demonstrates the Tribunal's commitment to ensuring a fair and thorough review of the case based on all available evidence and legal principles.