9911796707
TMI Blog2008 (5) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... This is an appeal against the order of the Commissioner No. 49/COMM/M-II/2006 dated 15-11-2006. 2. Heard both sides. 3. The relevant facts, in brief, are as follows :- (a) The appellants are manufacturers of dutiable aerated waters and exempted "Maaza" which is fruit pulp based drinks. (b) They procured capital goods and got installed five plants. It is claimed that out these five plants three plants can produce only dutiable goods, one plant can produce only exempted goods and the remaining one plant can produce both dutiable and exempted goods. Certain machines like Stretch Blow Moulding, Rinsing and Filing machine, Cooling Tower etc. were installed to make the plants which were used for manufacture of only 'Maaza', the exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity at higher cost. The actual manufacture necessarily depended upon, the demand for the product in the market. He also submitted that when the capital goods are capable of being used in the manufacture of dutiable goods, the fact that they were not used is immaterial; even if they are to be used in future the credit is admissible. He also submitted that as a matter of fact they have since used the capital goods in October 2006 to manufacture certain quantities of dutiable aerated waters. 5. In support of his above contentions he relied on various judgments which are discussed below. 5.1 He relied on the decision in the case of PSL Limited v. Commissioner of Custom & Central Excise, Visakhapatnam-I reported in 2007 (214) E.L.T. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umbai). (iii) Gopala Polyplast Ltd. v. CCE, Ahmedabad - 2003 (152) E.L.T. 121 (Tri.-Mumbai). (iv) CCE, Coimbatore v. Sree Lakshmi Venkateswara Spg. Mills - 2005 (188) E.L.T. 513 (Tri.-Chennai). (v) Jayaswals Neco Ltd. v. CCE, Nagpur - 2006 (195) E.L.T. 142 (S.C) = 2007 (8) S.T.R. 305 (S.C.). 6. Learned DR briefly took us through the scheme of cenvat scheme. He drew our attention that Rule 4 of Cenvat Rules permits credit to be taken immediately on receipt of the inputs and in respect of capital goods it permits part of the credit to be taken immediately on receipt; Rule 6(4) prohibits credit on capital goods "used exclusively for the manufacture" of exempted goods; the admissibility to credit was not linked to capability of being u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed waters, they claim that they are eligible for the credit taken and utilized. 8. The availability of credit is dependent on factors/conditions like duty paid nature of the capital goods, receipt of the same in the factory and use of the capital goods for manufacture of dutiable goods. In particular, the credit eligible is not based on capability but based on use in the manufacture of dutiable goods. These conditions are required to be fulfilled at the time of receipt of the capital goods which is the relevant time. Subsequent developments cannot influence the eligibility. For example, the status of the goods manufactured may change from dutiable to exempt and vice versa. If the final products are dutiable when the capital goods are ..... X X X X Extracts X X X X X X X X Extracts X X X X
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