2017 (9) TMI 1369 - AT - Central Excise

CENVAT credit - steel items used in fabrication work at factory for construction of shed/ construction for support of machinery - Held that - the Hon ble Apex Court in the case of Saraswati Sugar Mills 2011 (8) TMI 4 - SUPREME COURT OF INDIA has held that Iron and Steel structures are not the components of machineries used in the installation of Sugar Manufacturing Plant - items used for fabrication of supporting structure cannot be allowed. Moreover with effect from 07.07.2009 the definition of input appearing in Rule 2(k) of the Cenvat Credit Rules, 2004 has been amended and it specifically excludes cement, angles, channels, Centrally Twisted Deform bar (CTD) or Thermo Mechanically Treated bar (TMT) and other items used for construction of factory shed, building or laying of foundation or making of structures for support of capital goods from the ambit of definition of inputs. Appeal dismissed - decided against appellant.

Summary

Issues Involved:
Denial of cenvat credit on steel items used in fabrication work at factory for construction of shed/ construction for support of machinery.

Analysis:
The appellant argued that the credit of steel items used in fabrication work should be allowed based on a Tribunal decision and contended that the amendment to the definition of input by a specific notification should not be applied retrospectively. The appellant also challenged the invocation of the extended period in the case. The respondent relied on the decision of the Hon'ble Apex Court regarding the exclusion of steel structural items used for supporting capital goods after an amendment to the definition of input.

The Tribunal examined the submissions and referenced the Hon'ble Apex Court's finding in a similar case. The Tribunal highlighted that the steel items in question were used as supporting structures for capital goods, which the Hon'ble Apex Court had previously determined did not qualify for credit. Additionally, the Tribunal noted the specific exclusion of certain items, including steel used for construction purposes, from the definition of inputs post an amendment dated 07.07.2009. Citing this amendment and the Apex Court's decision, the Tribunal concluded that the appellant's appeal lacked merit and dismissed it accordingly.

In summary, the Tribunal upheld the denial of cenvat credit on steel items used in fabrication work for construction purposes, based on the exclusion specified in the amended definition of input and the precedent set by the Hon'ble Apex Court's ruling on similar matters.