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TMI Blog2018 (3) TMI 1547X X X X Extracts X X X X X X X X Extracts X X X X ..... ] held that even though steel plates and M.S. Channels are used in fabrication of Chimney, would fall within the ambit of 'capital goods'. The eligibility to duty credit of the disputed good cannot be denied. Such eligibility either as ‘capital goods’ (accessories) or as ‘inputs’ has been examined and upheld by various decisions - reference allowed - decided in favor of appellant. - E/101/2011-EX[LB] - IO/14/2018 - Dated:- 5-3-2018 - Dr. Satish Chandra, President, Mr. S.K. Mohanty, Member (Judicial) And Mr. B. Ravichandran, Member (Technical) Present for the Appellant: Ms. Rinki Arora, Advocate Present for the Respondent: Mr. Ubav Sengraj, A.R. ORDER Per: S.K. Mohanty This matter has come up before the Larger Bench on the basis of Interim Order No.71/2017 dated 01.09.2017, passed by the Single Member Bench of this Tribunal, in Appeal No.E/101/2011-SM, in the case of M/s Mangalarn Cement Ltd. The issue involved in the said appeal relates to consideration of Cement availment of Cenvat Credit of the Central Excise duty paid thereon. In this case, the appellant had used the said goods in the structural foundation to support the power plant, which itse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) all goods falling under Chapter 82, Chapter 84, Chapter 85, Chapter 90, heading No.6805 grinding wheels and the like, and parts thereof falling under heading 6804 of the First Schedule to the Excise Tariff Act; (ii) pollution control equipment; (iii) components, spares and accessories of the goods specified at (i) and (ii); (iv) .; (v) . ; and (vi) .; used- (1) in the factory of the manufacturer of the final products, but does not include any equipment or appliance used in an office; or (2) for providing output service; 2(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, with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , which could be added for something else, in order to make the former more useful, versatile or attractive. Since, the disputed goods were used for fabrication of support structure for smooth erection of the machines, the same in our view should be considered as 'accessories' of the capital goods. 7. For ascertaining as to whether a particular item would fall under the definition of 'capital goods' or not, the r user test' has to be applied to find out that in absence of use of that particular goods, what will be ultimate effect on the goods manufactured by the assessee. It is no doubt a fact that the above machineries without its proper installation, will not be functional to the satisfaction level, in order to achieve the desired objective. Thus, applying the 'user test' the Hon'ble Supreme Court in the case of Rajasthan Spinning Weaving Mills Ltd. - 2010 (255) ELT 48 (S.C.) held that even though steel plates and M.S. Channels are used in fabrication of Chimney, would fall within the ambit of 'capital goods'. The relevant paragraphs in the said judgment are extracted herein below: 12. Inter alia observing that capital goods ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at benefit. 9. On perusal of definition of input extracted above, it would reveal that all the goods (excepting light diesel oil, high speed diesel oil and motor spirit) are considered to fall under such definition, when N used in or in relation to manufacture of final products', whether directly or indirectly, and whether contained in the final product or not. The only condition required to be fulfilled is that the goods must be used within the factory of production. Further, explanation 2 appended to such definition clause provides that input includes goods, which are used in the manufacture of capital goods for further use in the factory of the manufacturer. On a conjoined reading of the definition of input and explanation appended there to, it makes the position clear that inputs are not only goods, which are used in the manufacture of final product, but also those which are used in or in relation to the manufacture of the final product. The relationship between those goods and the final product could be either direct or indirect and may include or may not include their presence in the final products. Goods used in the manufacture of capital goods, which are instal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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