2018 (3) TMI 841 - AT - Central Excise

CENVAT credit - inputs/capital goods - HR Plates, Base Plates, MS Channels, MS plates, Angles etc - Held that - there is no dispute as to the fact that these items were received in the factory premises and consumed for fabrication of various frame works for lift operation, furnace control room etc. - Hon ble High Court of Madras in the case of Thiru Arooran Sugars Vs CESTAT 2017 (7) TMI 524 - MADRAS HIGH COURT has specifically held that these items are eligible for availment of CENVAT credit - credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues: Denial of CENVAT credit on various items

Analysis:
1. Issue Identification: The case involves Appeal Nos. E/977 & 978/2011 regarding the denial of CENVAT credit on HR Plates, Base Plates, MS Channels, MS plates, Angles, etc., from July 2006 to December 2009.

2. Contention: The Revenue argues that these items are neither inputs nor capital goods, thus CENVAT credit cannot be availed. The Appellant asserts that these items are used for fabricating capital goods, structural frameworks, machinery, and raw-material handling systems.

3. Judicial Review: Upon reviewing the records, it is established that the items were indeed used in the factory premises for various fabrication purposes. The adjudicating authority's decision to deny CENVAT credit was based on a Tribunal decision in Vandana Global, which was later overturned by the High Court of Gujarat in Mundra Port & SEZ Ltd Vs CCE.

4. Precedent: The High Court of Madras has ruled in various cases that these items are eligible for CENVAT credit, such as in Thiru Arooran Sugars Vs CESTAT, Dalmia Cements Vs CESTAT, and CCE Vs India Cements Ltd.

5. Tribunal's Decision: The Tribunal followed the precedent set by the High Courts in the cases of Andhra Sugars Vs CCE Guntur and Binjusaria Sponge & Iron power Pvt Ltd Vs CCE Hyderabad. Considering the settled issue by higher judicial fora, the Tribunal deemed the impugned order unsustainable and allowed the appeal, setting aside the original order.

6. Conclusion: The Tribunal concluded that the denial of CENVAT credit on the mentioned items was unjustified based on established legal precedents and higher court decisions. Therefore, the impugned order was set aside, and the appeal was allowed.

This detailed analysis highlights the legal journey of the case, from the initial denial of CENVAT credit to the final decision by the Appellate Tribunal, emphasizing the importance of legal precedents and judicial decisions in resolving such issues.