2018 (5) TMI 536 - AT - Central Excise

CENVAT credit - whether the appellants herein are eligible to avail CENVAT credit on MS Plates, MS Channels and angles, SS Sheets, MS Chequer Coils, MS Flats, welding electrodes, bolts, nuts and screws used in the appellants manufacturing premises or otherwise? - Held that - It is a fact that CENVAT credit of Central Excise Duty paid on MS flats, angles etc. are availed and are undisputedly used for fabrication of various machineries and supporting structures - the issue has been settled by Hon ble High Court of Gujarat in the case of Mundra Ports & SEZ Limited 2015 (5) TMI 663 - GUJARAT HIGH COURT , where it was held that these items are inputs and Central Excise duty paid on these inputs are eligible for availment of CENVAT credit under rule 2(k) of CENVAT Credit Rules, 2004, prior to 07.07.2009. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Whether the appellants are eligible to avail CENVAT credit on various materials used in manufacturing premises.

Analysis:
In the present case, three appeals were filed against Orders-in-Original, all involving a common issue of eligibility for CENVAT credit on specific materials used in manufacturing premises. The main contention revolved around whether the materials in question could be considered inputs for capital goods. The lower authorities had denied the credit based on the argument that the materials were not capital goods or inputs for capital goods. However, the appellants argued that the materials were used for the fabrication of capital goods, such as machinery and supporting structures. The Tribunal considered the relevant legal framework, including the CENVAT Credit Rules 2004, and previous decisions, particularly the case of Vandana Global Limited. The appellants relied on judgments from the Hon'ble High Courts of Gujarat and Madras, which held that the disputed items were indeed inputs eligible for CENVAT credit. The Tribunal noted that the issue had been settled by these High Court decisions and a previous order in a related case. Therefore, the Tribunal found in favor of the appellants, setting aside the impugned orders and allowing the appeals.

This case highlights the importance of determining the eligibility for CENVAT credit on specific materials used in manufacturing processes. The Tribunal's decision was based on a careful analysis of the legal provisions, precedents, and the specific facts of each appeal. By considering the arguments presented by both sides, as well as relevant case law, the Tribunal concluded that the materials in question were indeed eligible for CENVAT credit. The reliance on High Court judgments and a previous order by the same Tribunal bench added weight to the decision. Overall, the judgment provides clarity on the interpretation of the law regarding CENVAT credit eligibility, ensuring consistency in such matters.