2008 (8) TMI 302 - AT - Central Excise

Application for rectification of mistake - It is submitted that Modvat credit on capital goods used at off-factory limestone mines was denied in the above final order on the ground that the capital goods were used outside the factory of production of final product - impugned order denying credit with considering SC s decision in case of Vikram Cement - non-consideration of the apex Court s judgment by the Tribunal at the time of final disposal of the appeals should be treated as an apparent error which requires to be rectified - application allowed

Summary

Issues: Mistake apparent from the record in Final Orders denying Modvat credit on capital goods used at off-factory limestone mines; Non-consideration of the Apex Court's judgment in the second Vikram Cement case by the Tribunal.

In this case before the Appellate Tribunal CESTAT, Chennai, the appellants highlighted a mistake in Final Order Nos. 1273 & 1274/2007, where Modvat credit on capital goods used at off-factory limestone mines was denied. The denial was based on the grounds that the capital goods were used outside the factory of production of the final product, cement, citing previous Apex Court judgments. However, the appellants argued that the second Vikram Cement case held that Modvat credit on capital goods used in captive mines by a cement manufacturer would be admissible, provided the capital goods were used in mines catering only to the limestone requirement of the assessee. The appellants contended that the capital goods in question were used only in captive mines, thus entitling them to avail Modvat credit. They also pointed out the non-consideration of the Apex Court's judgment by the Tribunal at the time of final disposal of the appeals, which they argued was an apparent error requiring rectification.

The Tribunal, after hearing both sides, acknowledged the error in Final Order Nos. 1273 & 1274/2007 due to the non-consideration of the Apex Court's judgment in the second Vikram Cement case. Referring to the Larger Bench decision in Hindustan Lever case, the Tribunal held that the error was apparent from the record and accordingly recalled the Final Orders. The applications by the appellants were allowed to that extent, and the appeals were set to be disposed of by separate order. This decision reflects the Tribunal's adherence to legal precedents and the correction of errors in the application of law to ensure fair treatment and justice for the appellants.