2019 (5) TMI 1580 - AT - Central Excise

Rectification of mistake - error apparent on the face of record - applicant submits that the order was pronounced in the open court as Appeal allowed , however in the order No. A/12089/2017 dated 28.08.2017, the order was passed as Appeal allowed by way of remand. - HELD THAT - I find from the note-sheet, it is clear that Hon'ble Member (Judicial), after hearing the matter allowed the appeal. However, in the typed and signed order, the appeal has been allowed by way of remand, therefore, there is an apparent error. Accordingly, the order dated 28.08.2017 is recalled and taken up for fresh disposal as agreed by the ld. Counsel. CENVAT Credit - capital goods - steel structural items - HELD THAT - Since the appellant is not pressing for three items i.e. Structural Steel/ MS Beams, Base Frame and Lighting protection mat, the demand to the extent of these goods stands confirmed, without going into merits of the case - demand upheld. CENVAT Credit - capital goods - Base Plate - HELD THAT - The appellant have received the Base Plates as part of capital goods falling under Chapter heading 84779000. Since the classification of this item has not been challenged by the Revenue that it is falling under Chapter 84, the same is eligible for Cenvat credit as per definition of capital goods. Therefore, the credit in respect of Base Plate is allowed. CENVAT Credit - capital goods - Structure for creel loading system - HELD THAT - The same is installed as structure which is exclusively used for rolling of material from one stage of manufacturing to other and therefore, it is clearly a part of material handling system and falling under the definition of the capital goods and hence the credit is admissible. Penalty - HELD THAT - The issue of eligibility of Cenvat credit on identical goods was a matter of dispute for long and various contrary judgments were passed on the issue, it cannot be said that the appellant had a malafide intention - Penalty set aside. Appeal allowed in part.

Summary

Issues Involved:
Eligibility of Cenvat credit on steel structure items.

Analysis:

1. Pronouncement Discrepancy:
The applicant filed a ROM application due to a discrepancy in the pronouncement and typed order of the appeal decision. The advocate argued that once the appeal was pronounced as "Allowed" in the open court, the typed order should not differ. The issue involved the eligibility of Cenvat credit on various steel structure items, including Structural Steel, Base Plate, Base Frame, Structure for Creel loading system, and Lighting protection mat.

2. Applicant's Arguments:
The advocate contended that certain items like Structural Steel, Base Frame, and Lighting protection mat should be eligible for credit based on the 'user test' even though the period was post-amendment. Reference was made to a previous tribunal case supporting this argument. For the Base Plate, it was argued that it falls under Chapter heading 84779000 as part of machinery and should be considered capital goods. Similarly, for the Structure for Creel loading system, it was claimed to be part of material handling equipment, making it eligible for credit as capital goods. The advocate emphasized the absence of malafide intention on the appellant's part due to the interpretation of law and conflicting judgments.

3. Revenue's Response:
The Revenue representative reiterated the findings of the impugned order, emphasizing that the matter was remanded, leaving no room for rectification. However, during the hearing, it was noted that there was an error in the typed order, leading to a recall of the order for fresh disposal.

4. Tribunal's Decision:
Upon review, the Tribunal found that the appellant was not contesting the eligibility of credit for certain items, confirming the demand for those goods. Regarding the Base Plate, since it was received as part of capital goods falling under Chapter heading 84779000, and its classification was not challenged by the Revenue, the credit was deemed admissible. Similarly, the Structure for Creel loading system was considered part of the material handling system and falling under the definition of capital goods, making it eligible for credit. The Tribunal partially allowed the appeal, modifying the impugned order and setting aside the penalty due to the long-standing dispute over the eligibility of Cenvat credit on similar goods and the existence of conflicting judgments.

5. Conclusion:
The modified order partially allowed the appeal based on the eligibility of Cenvat credit for specific steel structure items, considering the arguments presented by both parties and the precedents cited. The penalty imposed was set aside due to the absence of malafide intention on the appellant's part.