2017 (4) TMI 642 - AT - Central Excise

CENVAT credit - H.R. Plates, Channels, H.R. sheet plates, H.R. coil, MS Channels, Flat bars, NAS EQ angles, GP Coil sheets, MS Beams, Prime Hot Rolled non-alloy, MS Joist etc. - credit was confirmed placing reliance in the case of Vandana Global Ltd. 2010 (4) TMI 133 - CESTAT, NEW DELHI (LB) - Held that - The entire basis of the Department s case is Larger Bench s decision in the case of Vandana Global. In the present case, the fact is different from the facts involved in the Vandana Global case. In the Vandana Global case, the fact was that the steel material was used for making the structure which was used for erection of plant and machine. In the present case, the steel material was used in fabrication of part of Boiler and DM plant. For this reason, ratio of Vandana Global case is not applicable. Also, the amendment made on 7.7.2009 in the definition of inputs cannot be applied retrospectively - the Vandana Global judgment which has applied the amendment retrospectively is not applicable in the facts of the present case. Appeal dismissed - decided against Revenue.

Summary

Issues:
Whether certain steel goods used in the fabrication of a Boiler are eligible for CENVAT Credit as capital goods under Chapter 72 & 73 of the Central Excise Tariff Act, 1985.

Analysis:
The respondent availed credit for various steel goods treating them as capital goods used in their cogeneration plant. The issue revolved around the eligibility of these goods for CENVAT Credit, especially when used in the fabrication of the Boiler, considered an immovable goods. The matter was remanded by the Tribunal to the original adjudicating authority for a fresh decision in light of the Vandana Global Ltd. case. The adjudicating authority confirmed the demand and imposed penalties, leading to an appeal by the appellant before the Commissioner (Appeals).

Grounds of Appeal by Revenue:
The Revenue heavily relied on the Larger Bench's decision in the Vandana Global Ltd. case, arguing that the steel items were used for a structural component, not admissible for CENVAT Credit as per the Vandana Global judgment.

Appellant's Submission:
The appellant contended that the steel goods were used for the fabrication of parts of the Boiler and DM plant, not for making structures for the plant. They argued that the Vandana Global judgment was based on a retrospective amendment in the definition of inputs, which subsequent judgments held cannot be applied retrospectively. The appellant also cited various supportive judgments.

Decision:
The Tribunal noted that the facts in the present case differed from the Vandana Global case as the steel material was used in the fabrication of parts of the Boiler and DM plant, not for making structures. Additionally, the period involved did not align with the retrospective application of the amendment in the definition of inputs. Relying on the Chhattisgarh High Court judgment, the Tribunal upheld the Commissioner (Appeals) order, dismissing the Revenue's appeal.

This detailed analysis of the judgment highlights the key issues, arguments presented by both parties, and the Tribunal's decision based on the facts and legal principles involved.