2015 (10) TMI 1971 - AT - Central Excise

Denial of CENVAT Credit - whether Cenvat credit is admissible for bought out items like; Nuts, Bolts and Washer cleared along with the finished excisable goods i.e. tower parts which are used for erection of non-excisable Towers at site outside the factory premises of the appellant; under Cenvat Credit Rules, 2004 - Held that - The attitude of the appellants indicate that they are not interested in pursuing their case by not being present during hearings fixed for the purpose. On merits it is observed that items on which credit has been availed have not been established to be used either in or in relation to the manufacturing activities in the factory of the appellant. The items claimed to be inputs do not satisfy the definition of inputs given under Rule 2 of the Cenvat Credit Rules, 2004. On merits order passed by the first appellate authority are correct and is required to be upheld. - appeals filed by the appellant are dismissed on merits as well as for non-prosecution - Decided against assessee.

Summary

Issues: Admissibility of Cenvat credit for bought out items like Nuts, Bolts, and Washer cleared with finished excisable goods for erection of non-excisable Towers at site outside factory premises.

Analysis:
1. The appeals were filed against the OIA Nos. COMMR-A-/143&144/VDR-I/2010, dated 22-6-2010, passed by the Commissioner (Appeals), Vadodara. The central issue was whether Cenvat credit is permissible for bought out items like Nuts, Bolts, and Washer, which are cleared along with finished excisable goods used for erecting non-excisable Towers at a site outside the factory premises.

2. During the hearing, no representation was made on behalf of the appellant, indicating a lack of interest in pursuing the case. The absence of the appellant during multiple hearings further demonstrated disinterest in the proceedings.

3. The Revenue argued that bought out items are not utilized in manufacturing activities within the factory premises but are only supplied along with tower parts. It was contended that as these items are not used in or in relation to manufacturing activities, Cenvat credit under Rule 2 of the Cenvat Credit Rules, 2004, should not be allowed.

4. The learned AR's argument was considered, and the case records were examined. It was noted that the items for which credit was claimed were not proven to be used in or in relation to manufacturing activities within the appellant's factory. The items did not meet the definition of 'inputs' as per Rule 2 of the Cenvat Credit Rules, 2004. Consequently, the orders passed by the first appellate authority were deemed correct and upheld based on merits.

5. Ultimately, the appeals filed by the appellant were dismissed both on merits and for non-prosecution. The decision was based on the observation that the items for which Cenvat credit was sought did not qualify as inputs under the Cenvat Credit Rules, 2004, and the appellant's lack of interest in pursuing the case.