2001 (8) TMI 183 - AT - Central Excise

Summary

Issues involved: Stay applications for waiver of pre-deposit of duty and penalty; Denial of Modvat credit on various capital goods.

In the present case, the appellants filed stay applications seeking waiver of pre-deposit of duty and penalty pending disposal of the appeals challenging the orders-in-appeal denying them the benefit of Modvat credit on specific capital goods. The appellants contended that the lower appellate authority failed to consider their submissions and evidence on record, asserting that the capital goods were utilized within the factory of production, thus justifying the Modvat credit. The appeals were a result of a series of legal proceedings starting from an appeal before the Commissioner (Appeals) to the Tribunal, which remanded the matter for fresh consideration leading to the current appeals challenging the denial of Modvat credit.

Regarding PVC pipes and fittings, the learned Counsel argued that Modvat credit is available based on a Tribunal judgment. Similarly, for staging structural material and centrifugal machinery, it was contended that Modvat credit is admissible as supported by precedents from the Tribunal. The Counsel also cited cases where Modvat credit on M.S. Plates, chequered plates, slag wool, M.S. Tanks, corrugated sheets, ceramic fibre blankets, and AAAC Conductors was held to be admissible, emphasizing their relevance to the manufacturing process and citing relevant Tribunal judgments.

After considering the submissions from both sides, the Member (T) held that Modvat credit is admissible to all the items in question except for corrugated sheets made of asbestos, as they were deemed to be used for covering heat exchangers and not directly related to the manufacturing process. Relying on the cited judgments, the Member modified the impugned order to allow Modvat credit on all items except corrugated sheets. The appeals were allowed accordingly, granting relief to the appellants.

Additionally, a request was made for the issuance of a copy of the order due to the seizure of sugar, which was granted by directing the Registry to provide the copy within a specified timeline for the party's benefit.