2009 (9) TMI 431 - AT - Central Excise

Cenvat Credit- The Aluminium Sheets which are used as part of lining of the boiler and have been used for replacing the worn out parts of boiler lining are eligible for Cenvat credit as capital goods. The Asstt. Commissioner vide order-in-original disallowed the Cenvat credit on this item and confirmed Cenvat credit demand of Rs. 10837/- along with interest and imposed penalty of equal amount on the appellant under Rule 15 of Cenvat Credit Rules 2004. The appellant s appeal to Commissioner (Appeals) was dismissed by Commissioner (Appeals). In the light of the decision of L.H. Sugar Factories s case reported in 2005 (189) E.L.T. 85 wherein it was held that MS Plates used for maintenance of machinery and of the capital goods are entitled for Cenvat Credit. In view of this I hold that the impugned order denying the Cenvat credit in respect of aluminium sheet as capital goods is not correct and hence the same is set aside and the appeal is allowed with consequential relief.

Summary

The Appellate Tribunal CESTAT, New Delhi, in the citation 2009 (9) TMI 431 - CESTAT, New Delhi, heard an appeal regarding whether Aluminium Sheets used for boiler lining replacement are eligible for Cenvat credit as capital goods. The Asstt. Commissioner disallowed the credit, which was confirmed by the Commissioner (Appeals). The appellant argued that the sheets are spare parts of the boiler and covered by the definition of capital goods. The Tribunal noted that the sheets were used for repair and maintenance of the boiler, and therefore, should be considered as part of the boiler and eligible for Cenvat credit. Referring to a judgment by the Hon'ble Rajasthan High Court, the Tribunal concluded order denying the credit was incorrect and allowed the appeal with consequential relief. The order was dictated in open court by Shri Rakesh Kumar, Member (T). Shri Kapil Vaish represented the appellant, and Shri Sansar Chand represented the respondent. The Tribunal thoroughly considered the submissions from both sides and the evidence provided, ultimately setting aside the original order and allowing the appeal.