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TMI Blog2011 (2) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... 91 (Tribunal)] whereby and whereunder the respondent was held eligible to claim credit under the CENVAT Credit Rules, 2004 (the Rules). The other appeal is against the Final Order No. 858/2010, dated 21-5-2010 in Appeal No. ST/420/2008 whereby and whereunder the CESTAT vacated the penalty imposed by the first appellate authority, namely, the Commissioner of Central Excise and Customs (Appeals), Visakhapatnam. Both the appeals were against the common order dated 30-7-2008 passed by the appellate authority. 2. The fact of the matter, which is not disputed by the appellant, is that the respondent assessee was registered under Section 69 of the Finance Act, 1994 (the Finance Act) with Central Excise, Service Tax Cell, Kakinada-II Divisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Excise and Customs (Appeals), Visakhapatnam. The department also filed an appeal in so far as the Order-in-Original declined to levy penalty under Rule 15(2) of the Rules. By common order dated 30-7-2008, the appellate authority dismissed the assessee's appeal and allowed the department's appeal accepting the plea that there was suppression regarding usage of ineligible goods and availment of CENVAT credit on such goods attracting Rule 15(2) of Rules read with Section 11AC of the Central Excise Act. The assessee, therefore, filed two appeals before the CESTAT. 4. The Junior Standing Counsel for Central Excise and Customs submits that cement used for making foundations, and TMT bars used for reinforcement, cannot be treated as 'capit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o input service. Rule 2(k) and (l) of the Rules are relevant and they read as under. 2. Definitions.- (k) "input" means- (i) all goods, except light diesel oil, high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final product, goods used as paint, or as packing material, or as fuel, or for generation of electricity or steam used in or in relation to manufacture of final products or for any other purpose, within the factory of production; (ii) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of final product or for any other purpose used by a provider of taxable service for providing an output service are eligible for CENVAT credit. In Maruti Suzuki Ltd. v. Commissioner of Central Excise, Delhi-III, (2009) 9 SCC 193 = 2009 (240) E.L.T. 641 (S.C.) the Supreme Court laid down as follows. 9. Coming to the statutory definition of the word "input" in Rule 2(g) in the CENVAT Credit Rules, 2002, it may be noted that the said definition of the word "input" can be divided into three parts, namely: (i) specific part (ii) inclusive part (iii) place of use 10. Coming to the specific part, one finds that the word "input" is defined to mean a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ligible input, since it has a significant role to play in the manufacturing process and since the final product cannot emerge without the use of gas. Similarly, Heat Transfer Oil used as a heating medium in the manufacture of LAB is an eligible input since it has a persuasive role in the manufacturing process and without its use it is impossible to manufacture the final product. Therefore, none of the categories in the inclusive part of the definition would constitute relevant consideration per se. They become relevant only when the above crucial requirement of being "used in or in relation to the manufacture" stands complied with. In our view, one has to therefore read the definition in its entirety. 9. There is no dispute, in these ..... X X X X Extracts X X X X X X X X Extracts X X X X
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