2018 (7) TMI 1208 - AT - Central Excise

CENVAT Credit - inputs/capital goods - steel items, profile sheets, electrodes, cement, etc. - Held that - The findings recorded by the adjudicating authority that these items were used for foundation/civil construction, structures of various industrial equipments and roof of plant and machinery, we find and there is no dispute as to the fact that these inputs were received and consumed in the factory premises of the appellant - in the case of Penna Cement Industries Ltd 2018 (5) TMI 653 - CESTAT HYDERABAD it was held that CENVAT credit availed on various items in the period prior to 07.07.2009 needs to be allowed. Credit allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Eligibility of CENVAT credit on various inputs for fabrication and erection of plant and machinery.
2. Dispute over the denial of CENVAT credit on specific items.
3. Adjudication of appeals against Order-in-Original No. 06/2009.

Analysis:
1. The case involved appeals against an Order-in-Original regarding the eligibility of CENVAT credit on inputs like steel items, profile sheets, electrodes, and cement for fabrication and erection of machinery. The lower authorities contended that these items did not qualify as inputs or capital goods. The appellant contested the show cause notices, providing evidence of input consumption. The adjudicating authority partially accepted the appellant's contentions, leading to appeals from both the appellant and the Revenue.

2. The appellant argued that the items in question were used in the factory premises during the relevant period. Citing precedents like the High Court of Madras and the CESTAT-Hyd, the appellant contended that similar items were eligible for CENVAT credit. The Revenue, however, maintained that these items were ineligible for credit as they were used for structural and construction purposes, not as capital goods in the manufacturing process.

3. The Tribunal analyzed the factual matrix and the contentions of both sides. It noted that the adjudicating authority had considered evidence provided by the appellant, leading to the dropping of demands for a significant amount of CENVAT credit. The Tribunal dismissed the Revenue's argument based on a judgment that had been overturned by higher courts. It also distinguished other cases cited by the Revenue, emphasizing the specific issue at hand. Ultimately, the Tribunal allowed the appellant's appeal and rejected the Revenue's appeal, based on the High Court's interpretation of CENVAT credit rules and the factual evidence presented in the case.