2013 (2) TMI 8 - AT - Central Excise

Cenvat credit - capital goods which are cleared as waste and scrap - Held that - FAA was correct in coming to the conclusion that the issue is no more res-integra in as much as that the division bench of the Tribunal in the assessee s own case 2010 (8) TMI 274 - CESTAT, AHMEDABAD wherein held waste and scrap of metal generated out of dismantling of machinery are due to wear and tare of machine parts cannot be treated as excisable goods leviable to duty as waste and scrap as defined in note 8(A) of Section 15 of CETA 1985 - Tribunal had taken a view that scrap which is generated from capital goods is not covered by this definition as held in the favour of the assessee.

Summary

Issues:
- Discharge of service tax liability under Rule 3(5A) of Cenvat Credit Rules, 2004 on capital goods cleared as waste and scrap.
- Interpretation of the decision in the case of Shriram Alkali & Chemicals 2010 (259) ELT 77 (Tri. Ahmd.).
- Acceptance of the decision by the department in the assessee's own case.

Analysis:
The appeal before the Appellate Tribunal CESTAT Ahmedabad pertained to the discharge of service tax liability on capital goods cleared as waste and scrap under Rule 3(5A) of the Cenvat Credit Rules, 2004. The adjudicating authority had held that the respondent must discharge excise duty on the credit taken on the capital goods. However, the first appellate authority, relying on the decision in the case of Shriram Alkali & Chemicals, set aside the original order. The Revenue's grounds of appeal focused on the department's non-acceptance of the Tribunal's decision in the assessee's own case. The Tribunal noted that the issue was no longer res-integra as the division bench had previously ruled in favor of the assessee in a similar case. Consequently, the Tribunal found no reason to interfere with the first appellate authority's decision, stating that it followed judicial discipline and was legally sound.

In conclusion, the Tribunal rejected the appeal, affirming the correctness and legality of the first appellate authority's decision. The judgment highlighted the importance of precedent and consistency in judicial decisions, ultimately upholding the order that favored the assessee in this case.