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TMI Blog2015 (12) TMI 1209X X X X Extracts X X X X X X X X Extracts X X X X ..... ose capital goods in respect of which credit of duty was allowable under any other rule or notification prior to the 16th day of March, 1995) shall be allowable if such capital goods were received in the factory before the 16th day of March, 1995. On a plain reading of sub-rule (2) of rule 57Q of the rules, it is evident that credit of duty would be allowable on the capital goods in respect of which the credit of duty was allowable under any other rule or notification prior to 16th March, 1995. Under the circumstances, when the capital goods on which the assessee had claimed credit were capital goods in respect of which credit of duty was allowable under rule 57Q prior to its amendment under 16th March, 1995, such capital goods were entitled to Modvat credit and the amendment of the said rule would not take such goods out of the ambit of the excluded categories even in terms of sub-rule (2) of rule 57Q. - it is not possible to state that the impugned order passed by the Tribunal suffers from any legal infirmity so as to give rise to any question of law much less, a substantial question of law so as to warrant interference - Decided against Revenue. - Tax Appeal No. 801 of 2015 - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the Commissioner (Appeals), who by an order dated 18th February, 2010 allowed the appeal, both, on merits as well as on the ground that no case had been made out for invoking the extended period of limitation. The revenue carried the matter in appeal before the Tribunal, which came to be dismissed by the impugned order. 3. Mr. Y.N. Ravani, learned senior standing counsel for the appellant assailed the impugned order by placing reliance upon the findings recorded by the adjudicating authority whereby the adjudicating authority, on an interpretation of sub-rule (2) of rule 57Q of the rules as amended by the notification dated 16th March, 1995, observed that credit of duty paid on capital goods was allowable under rule 57Q of the erstwhile rules and even after amendment from 16th March, 1995, credit on duty paid on capital goods continued to be governed by the provisions of rule 57Q only. That the wordings of the amended sub-rule (2) clearly provided that credit in respect of specified item of capital goods given in clause (d) of Explanation I was allowable only if such credit was allowable under any other rule or notification prior to 16th March, 1995. According to the adjudic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... items on the ground that they were received prior to 16th March, 1995 even as they were appearing in the newly inserted list of capital goods at Sr. No.(d) in the notification dated 16th March, 1995. That Modvat credit in respect of the remaining three items of capital goods was denied as the same was not covered under the list of capital goods in the Explanation to rule 57Q prior to the amendment. That the adjudicating authority had held that the functional identity of these three items had not been put on record. The Commissioner (Appeals) noted as a matter of fact that the adjudicating authority had not denied the receipt of fifty five items covered under the invoices issued during the period 23rd November, 1994 and 28th February, 1995. After considering the provisions of rule 57Q prior to the amendment as well as pursuant to the notification dated 16th March, 1995, the Commissioner (Appeals) recorded the following findings:- 10.1 On scrutiny of the amended explanation and sub-rule (2) of the Rule 57Q of the said rules in consideration with the Notification No.11/95-C.E.(N.T.) dated 16.03.1995, I observe that in the said notification at (d) and (e), the chapter headings have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing these three items in question, hence, it is apparent that the respective authority accepted all 55 items as capital goods to be used by the appellant in view of the declarations. 10.4 Further to the more, as far as the burden of proving the functionality of these three items on the appellant is concerned as questioned by the lower authority, I find that after having acknowledged the declaration filed by the appellant, burden of proof lies on the shoulder of the department to disapprove the functionality of these items under the category of Capital Goods which was never done. Hence, I find that there was no doubt with regard to scope of these 55 items under the category of Capital Goods considering rule 57Q prior to Notification No.11/95-C.E.(N.T.) dated 16.03.1995. Further, I find that the appellant also followed all the conditions for availing the Modvat Credit as required under the said rules. 6. The Commissioner (Appeals), after going through the descriptions of the respective Tariff Heading of each of the items involved in detail, along with the place of installation, etc., observed that the items could be considered as capital goods without any doubt and found ..... X X X X Extracts X X X X X X X X Extracts X X X X
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