1999 (8) TMI 165 - AT - Central Excise

Summary

Issues involved: Disallowance of Modvat credit on supporting structures of steel and power pack voltage relay and choke cables used in the manufacture of clinkers and cement.

Supporting structures of steel: The Commissioner disallowed Modvat credit on the supporting structures of steel used by the appellants in the manufacturing process. The appellants argued that these structures are essential for supporting the clinker hopper and feed table, controlling material flow and spillage. The Tribunal held that the steel structures are part of the plant and are entitled to capital goods credit under Rule 57Q.

Power pack voltage relay and choke cables: The Commissioner also disallowed Modvat credit on power pack voltage relay and choke cables, which are electrical items. The appellants contended that these items are eligible for credit based on a judgment of the Larger Bench of the Tribunal. The Tribunal agreed, stating that these electrical items are entitled to credit as per the aforementioned decision.

Penalty imposition: The Tribunal set aside the penalty imposed on the appellants, as there was no wrongful availment of credit. The Tribunal found that the appellants were entitled to the Modvat credit on the disputed items, and hence, there was no basis for imposing a penalty.

Conclusion: The impugned order disallowing Modvat credit on the supporting structures of steel and electrical items was set aside, and the appeal was allowed in favor of the appellants.