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TMI Blog2016 (8) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... : Shri D.K. Deb (Assistant Commissioner) A.R. ORDER The issue in this appeal are - i) Whether the appellant, a manufacturer of Sugar, is entitled to Cenvat credit on Steels goods such as Shape Section, angles, M.S. Plates/rounds, beams, rails etc. falling under Chapter Heading 72, 73 83 of CET Act, also welding electrodes used in fabrication/construction of capital goods including structural support, etc. for the period Feb/ 2007 to June/2009 ii) Whether the exclusions provided in explanation-2 of Rule 2(k) of CCR, 2004, inserted w.e.f. 7.7.2009 have prospective effect only, iii) Whether the demand is barred by limitation and iv) Whether the appellant is liable for interest and penalty. 2. Heard the parties. 3. The brief facts are upon scrutiny of records by preventive branch of Division for the period 2/07 to 3/10, it appeared that appellant have availed inadmissible Cenvat credit amounting to ₹ 1,03,34,766 on steel items like Shape Section, Angles, M.S. Plates/rounds, Beams, Rails etc. as inputs in construction/fabrication of structural supports embedded to earth, Frame works, working platforms, etc. Such goods as per Revenue are neither in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ger res-integra in view of several rulings of Hon'ble High Courts and this Tribunal He places reliance on final order of this Tribunal No. 57918/2013 dated 25.9.2013 in Appellants own case (another unit) Excise Appeal No. 793/2011 (SM) wherein, it is held as follows - The appellant is a sugar mill engaged in manufacture of sugar and molasses chargeable to Central Excise duty. The dispute is in respect of Cenvat credit in respect of MS Angles, Channels, Plates etc. which according to the appellant were used for repair and maintenance of the as well as for fabrication of sugar machinery. The Cenvat credit of ₹ 71,090/- was taken in respect of welding electrodes and credit of ₹ 99,342/- was taken in respect of steel items during the period from January, 2009 to August, 2009. The department being of the view that these items are not covered by the definition of input or capital goods, initiated proceedings for recovery of the Cenvat credit along with interest and imposition of penalty which resulted in issue of Order-in-Original dated 31-3-2010 by which the Assistant Commissioner confirmed the above-mentioned Cenvat credit demand along with interest and imposed p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well as in the show cause notice, that Commissioner (Appeals) has in his order has wrongly mentioned that part of the steel items were used in erection of supporting structures for machinery, as there is no such allegation as in the show cause notice nor any observation in the Order-in-Original passed by the Assistant Commissioner, that the steel items have been used either in repair and maintenance or for fabrication of the various items of sugar mill machinery, and therefore, the same would be eligible for Cenvat credit as input, that Hon ble Rajasthan High Court in the case of Union of India v. Hindustan Zinc Ltd. reported in 2007 (214) E.L.T. 510 (Raj.) has held MS/SS plates used in the workshop for repair and maintenance are eligible for Cenvat credit and this civil appeal filed against this judgment of Hon ble Rajasthan High Court has been dismissed by the Apex Court vide judgment reported in 2007 (214) E.L.T. A115 (S.C.), that the steel items used for fabrication of various items of sugar mill machinery like Cane Carrier side plate and Leveller/Chopper Hoods, Bagasse Cilo Pipe, Bagasse Carrier etc. being sugar mill machinery and, hence, covered by Chapter 84, would be eligi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ended in that process or activity would have to be treated as used in the manufacture. When the Apex Court has interpreted the expression used in the manufacture of in the above manner, the scope of the expression - used in or in relation to manufacture, whether directly or indirectly in the definition of input in Rule 2(k) of the Cenvat Credit Rules, 2004 would be much wider. Moreover, Hon ble Calcutta High Court in the case of Singh Alloys Steel Ltd. v. Assistant Collector of Central Excise reported in 1993 (66) E.L.T. 594 (Cal.) has held that the definition of input does not depend on what ought to be used but what is commercially expedient to use and expression in relation to used in Rule 57A has wide connotation. Therefore, for determining the eligibility of an item for Cenvat credit, what is relevant is as to whether the activity in which that item is required has nexus with manufacture or in other words without that item the manufacturing, though theoretically possible, is not commercially feasible. Repair and maintenance, in my view is an activity without which though manufacturing activity may be theoretically possible, the same would not be commercially feasib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of providing storage and warehousing services, is entitled to take Cenvat credit on inputs like Cement, Iron Bars, Pipes etc. used in construction of warehouse, without which the assessee could not have provided the taxable service of storage warehousing. The Hon'ble Madras High Court in India Cements Ltd. Vs. Cestat (2015) have relied and quoted 8 As far as the reliance placed on the decision reported in MANU/SC/0895/2011: 2011-TIOL-73-SC-CX (Saraswati Sugar Mills Vs. Commissioner of Central Excise, Delhi - III) in Civil Appeal No, 5295 of 2003 dated 02.8.2011 by the learned Standing Counsel appearing for the Revenue is concerned, we find that this Court had earlier considered the case of the assessee in two similar cases of the previous assessment years in CM.A, No. 1301 of 2005 dated 31.12.2012, where a reference was made to an order passed earlier in respect of the very same assessee. While dismissing the appeal filed by the Revenue, the Division Bench of this Court held as follows: 8 Even though learned standing counsel appearing for the Revenue submitted that the judgment in the assessee's own case reported in AIT-2011-358-HC (The Commissioner of Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r by referring to the earlier decisions. We do not think that this would in any manner prejudice the case of the Revenue, given the fact that on the identical set of facts, the assessee's own case was considered by this Court and by following the decision reported in (Commissioner of Central Excise Jaipur Vs. Rajasthan Spinning Weaving Mills Ltd), the Revenue's appeal was also rejected circumstances, this Civil Miscellaneous Appeal is dismissed. No Costs, Consequently, C.M.P. No. 16107 of 2005 is also dismissed 13. From a perusal of the above said judgment, it is seen that there is no change in the circumstances and this Court had already considered the issue and held that the decision reported in 2011-TIOL-73-SC-CX (Saraswati Sugar Mills Vs. Commissioner of Central Excise, Delhi-III) dated 02.08.2011 is distinguishable on facts. This Court applied the principles laid down in the decision of Commissioner of Central Excise Jaipur Vs. Rajasthan Spinning Weaving Mills Ltd (Supra) and held that the Tribunal was justified in allowing the assessee's contention in respect of the very same assessee. 15. Accordingly, following the principles laid down in Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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