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2024 (8) TMI 1401 - AT - Central ExciseCENVAT Credit - inputs - whether Cenvat credit availed on inputs such as HR Plates, Shape Section, Channels under Tariff Chapter No.72 73 and Welding Electrode under Tariff Heading No.8311 would be admissible or not? - HELD THAT - In the impugned order demand has been confirmed only on the basis of the Larger Bench decision in the case of VANDANA GLOBAL LTD. VERSUS CCE 2010 (4) TMI 133 - CESTAT, NEW DELHI (LB) which is no longer a correct law and which has been set aside by the Hon ble High Court in the decisions cited supra by the Appellant. Further, it is found that this issue is no more res integra and it has been consistently held by the High Court that the decision of the Larger Bench in Vandana Global is not a good law and once the decision in the case of Vandana Global has been held to be not a good law, therefore, the Appellant is entitled to avail the Cenvat Credit on various steel items and welding electrodes. The impugned orders are not sustainable - the impugned order is set aside - appeal allowed.
Issues:
1. Admissibility of Cenvat credit on inputs such as HR Plates, Shape & Section, Channels, and Welding Electrodes. 2. Sustainability of the impugned orders passed by the Commissioner (Appeals). 3. Applicability of the decision in the case of Vandana Global on Cenvat Credit availed by the Appellant. 4. Entitlement to Cenvat Credit on steel items utilized for fabrication of plant and machinery. Detailed Analysis: Issue 1: The primary issue in the present appeals is whether Cenvat credit availed on inputs like HR Plates, Shape & Section, Channels under Tariff Chapter No.72 & 73, and Welding Electrodes under Tariff Heading No.8311 would be admissible. The Appellant contended that they should be entitled to avail Cenvat Credit on these items as they are used in the manufacture of finished excisable goods. The Tribunal found that the demand was confirmed solely based on the Larger Bench decision in Vandana Global, which has been set aside by the High Court. Considering the consistent rulings of the High Court that the Vandana Global decision is not good law, the Tribunal held that the Appellant is entitled to avail the Cenvat Credit on the mentioned steel items and welding electrodes. Issue 2: The sustainability of the impugned orders passed by the Commissioner (Appeals) was questioned by the Appellant. They argued that the orders were not sustainable as they were passed without properly appreciating the facts and binding judicial decisions on the issue. The Tribunal agreed with the Appellant's contention, stating that since the decision in Vandana Global has been set aside by the High Court, the impugned orders were not sustainable. Therefore, the Tribunal set aside the impugned orders and allowed both appeals with consequential relief if any. Issue 3: The Tribunal addressed the applicability of the decision in the case of Vandana Global on the Cenvat Credit availed by the Appellant. The Appellant argued that the impugned order primarily relied on the Vandana Global decision, which has been held not to be good law by the Higher Forum. The Tribunal referenced various decisions such as Comm. of CE, Bolpur vs. Soumya Alloy Industries Ltd. and others, which supported the Appellant's argument that the Vandana Global decision is not valid law. By considering these precedents, the Tribunal concluded that the impugned orders were not sustainable. Issue 4: The entitlement to Cenvat Credit on steel items utilized for the fabrication of plant and machinery was also a point of contention. The Appellant claimed that such items should be considered as inputs under Rule 2(k) of the Cenvat Credit Rules, 2004. The Tribunal referred to judgments like Principal Comm. of CE & ST, Commissionerate, Ludhiana vs. IOL Chemicals and Pharmaceuticals Ltd. and others, which supported the Appellant's position. Based on these precedents and the argument presented, the Tribunal held that the Appellant is entitled to avail Cenvat Credit on various steel items used for fabrication. In conclusion, the Tribunal found in favor of the Appellant on all issues, setting aside the impugned orders and allowing both appeals with any consequential relief as per law. The judgment was pronounced in open court on 30.08.2024.
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