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TMI Blog2007 (8) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... ed from payment of duty prior to the 2003 Budget. The goods became dutiable only w.e.f. 1-4-2003. Certain capital goods were received by the assessees during June 2002 and September 2002 and installed in March 2003 and some of the capital goods were used in March 2003. Cenvat credit on the goods has been denied on the ground that final products (socks) were exempt at the time of receipt of capital goods, on the basis of the Tribunal's decision in CCE, Indore v. Surya Roshni Ltd. reported in 2003 (155) E.L.T. 481. 3. As per Rule 4(2) of the Cenvat Credit Rules, 2002, Cenvat credit upto 50% was available the moment capital goods were received in the factory of the manufacturer and the remaining 50% in any financial year subsequent to the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ailment of credit of the duty if the capital goods are used in the manufacture of final products on which no excise duty is payable. The credit is availed of as and when the capital goods are received by the manufacturer. When the impugned machine was received, it has been used in the manufacture of bulbs which were exempted from the payment of whole of the duty of excise leviable on them. The classification list may contain details of goods which are liable to pay duty. But it cannot be claimed therefrom that the machine was also meant to be used in the production of final goods chargeable to duty. The declaration mentioned in sub-rule (2) of Rule 57T to the effect that the capital goods in question shall not be used exclusively for produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lear intention that it shall be availing the credit on implementation of the third phase as the final product of third phase was dutiable." In view of this, the Respondents are not entitled to Modvat credit. Accordingly, we set aside the impugned Order and allow the Appeal filed by the Revenue." 6. The relevance of the date of receipt of capita) goods for the purpose of availment of credit has already been recognised by the Tribunal in Grasim Industries Ltd. v. CCE, 2004 (176) E.L.T. 265 wherein the Tribunal held that credit to the extent of 75% of CVD on capital goods alone was permissible as this was the percentage of admissibility of credit on the date when the capital goods were received under Project Import Regulations in the factory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n it is held that Modvat credit on capital goods can be utilised from the date of receipt of the goods before its use in the installed plant. (c) Hindustan Cables Ltd. v. CCE, Bolpur reported in 2001 (137) E.L.T. 735 (ERB - Kolkata) wherein it was held that credit taken before installation of the goods is not deniable. (d) Hind Spinners Industries Growth Centre v. CCE reported in 1997 (96) E.L.T. 651 (NRB - New Delhi) wherein it Is held that Modvat credit can be taken and utilised before installation of machine or accessories especially in factories already in existence and specified final product manufactured and cleared. (e) Pudumjee Pulp & Paper Mills Ltd. v. CCE reported in 1996 (87) E.L.T. 557 (WRB - Mumbai) wherein it is held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 2002 (143) E.L.T. 577, the Tribunal held that vested right of taking credit arises on the date of receipt of the goods and that the date of installation of capital goods being only a deferred date of taking credit, for administrative reasons, credit is eligible on the date of receipt of the goods. In CCE v. Sengunthar Spinning Mills, 1998 (99) E.L.T. 409, it was held that the availability of Modvat credit on capital goods has to be determined at the time of receipt of capital goods in the factory and if no modvat credit was available at that time, the question of subsequently making available any Modvat credit would not arise. 8. The recent decision of the Tribunal in CCE v. Precot Mills Ltd., 2007 (212) E.L.T. 483 follows the Surya Rosh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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