2017 (9) TMI 148 - AT - Central Excise

CENVAT credit - H.R.S.Plates,H.R.S.S. Plate, H.R. Steel Sheets, H.R. Coils, etc., used for fabrication of support structure of capital goods installed in the factory - Held that - similar issue decided in the case of M/s. Singhal Enterprises Private Limited Versus The Commissioner Customs & Central Excise, Raipur 2016 (9) TMI 682 - CESTAT NEW DELHI , where it was held that applying the User Test to the facts in hand, we have no hesitation in holding that the structural items used in the fabrication of support structures would fall within the ambit of Capital Goods as contemplated under Rule 2(a) of the Cenvat Credit Rules, hence will be entitled to the Cenvat Credit. Appellant should establish the said use by adducing evidences. In the result, the matter is remanded to the adjudicating authority to examine the claim of the appellant on the eligibility of credit on the aforesaid items and the Appellants are free to adduce evidence including the certificate from a Chartered Engineer on its use - appeal allowed by way of remand.

Summary

Issues:
- Admissibility of CENVAT credit on specific items used for fabrication of support structure of capital goods in a factory.
- Requirement of Chartered Engineer's Certificate as evidence for claiming credit.
- Interpretation of relevant legal principles and precedents regarding eligibility of credit on structural steel items.
- Necessity for evidence to support the claim of credit.

Analysis:

Admissibility of CENVAT Credit:
The appeal was filed against an order confirming demands for recovery of CENVAT credit availed on various items used for fabrication of support structures of capital goods in a factory. The appellant argued that the credit should be admissible based on the purpose of use, citing a judgment by the Tribunal in a similar case. However, the appellant did not provide a Chartered Engineer's Certificate to support their claim.

Requirement of Chartered Engineer's Certificate:
The appellant's claim for CENVAT credit was contested by the Revenue, emphasizing the lack of evidence, including the absence of a Chartered Engineer's Certificate. The Revenue suggested remanding the matter to the adjudicating authority for verification of the claim based on the supporting evidence.

Interpretation of Legal Principles:
The Tribunal referred to a judgment by the Principal Bench in a similar case, discussing the eligibility of credit on structural steel items used for support structures of capital goods. The Tribunal highlighted the user test to determine whether the items could be considered as capital goods, emphasizing the need for evidence to establish the use for fabrication of support structures.

Necessity for Supporting Evidence:
The Tribunal found merit in the Revenue's argument regarding the requirement for the appellant to establish the use of the items by providing evidence, such as a Chartered Engineer's Certificate. Consequently, the matter was remanded to the adjudicating authority for further examination, allowing the appellant to present additional evidence to support their claim. The adjudicating authority was directed to decide the issue based on the legal principles established in the Tribunal's previous judgment.

In conclusion, the appeal was allowed by way of remand, keeping all issues open for further consideration based on the evidence to be provided by the appellant regarding the admissibility of CENVAT credit on the items in question.