2018 (11) TMI 727 - AT - Central Excise

CENVAT Credit - capital goods - Cement as well as various Steel structurals which were used for the purpose of fabricating foundation structures for installation of capital goods in their factory - Held that - In the Larger Bench decision of Tribunal in the case of Mangalam Cement Ltd. Vs. CCE 2018 (3) TMI 1547 - CESTAT NEW DELHI , the benefit of Cenvat Credit stands allowed to assessee in similar circumstances - credit allowed - appeal allowed - decided in favor of assessee.

Summary

Issues:
1. Challenge to denial of Cenvat Credit on Cement and Steel structurals.
2. Appeal against Lower Appellate Authority's decision on Cenvat Credit.
3. Interpretation of Cenvat Credit eligibility for foundation structures.
4. Application of user test for capital goods in Cenvat Credit.

Analysis:
1. The judgment pertains to two appeals challenging the denial and allowance of Cenvat Credit on Cement and Steel structurals used for fabricating foundation structures for installing capital goods. The appellant contested the denial of Cenvat Credit by the Lower Appellate Authority.

2. The first appeal, E/633/2007, challenged the denial of Cenvat Credit, while the second appeal, E/01/2008, contested the allowance of Cenvat Credit on similar items. Both appeals were consolidated for disposal through a common order due to the similarity of the subject matter.

3. The appellant argued for the allowance of Cenvat Credit based on precedents and case laws such as Thiru Arooran Sugars, Singhal Entt. Pvt. Ltd., and Mangalam Cement Ltd. The appellant emphasized that previous decisions favored granting Cenvat Credit on Cement and Steel structurals used for foundation structures.

4. The Revenue opposed the appellant's arguments, citing the Larger Bench decisions in Vandana Global Ltd., Commissioner Of Central Excise, Guntur Vs. Andhra Sugar Ltd., and Union of India Vs. Hindustan Zinc Ltd. The Revenue relied on these decisions to support the denial of Cenvat Credit.

5. The Tribunal, after considering arguments from both sides and reviewing relevant case laws, noted that the issues were settled in favor of the assessee in previous decisions. The Tribunal referred to the Larger Bench decision in Mangalam Cement Ltd. Vs. CCE, where Cenvat Credit was allowed in similar circumstances. The Tribunal analyzed the user test for capital goods and concluded that the Cement and Steel bars used for foundation structures should be considered as 'input' for Cenvat Credit eligibility.

6. Following the precedent set by the Larger Bench decision, the Tribunal decided to rule in favor of the assessee in both appeals, allowing the Cenvat Credit on Cement and Steel structurals used for fabricating foundation structures.

7. Consequently, both appeals were disposed of in favor of the assessee, aligning with the decision based on the interpretation of Cenvat Credit eligibility for foundation structures and the application of the user test for capital goods.