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TMI Blog2019 (5) TMI 913X X X X Extracts X X X X X X X X Extracts X X X X ..... plot cannot be said to part of the manufacturing operations of Appellant. Thermal power plant erected at A-31 MIDC Industrial Area, Butibori District Nagpur, has been erected on the plot which do not form the part of factory premises of the Appellant - All the statutory permissions required for setting up and operating the Thermal Power Plant at the aid premises have been obtained by and granted to 2nd Party - 2nd Party has constructed, erected, owns, operates and maintains the thermal power plant strictly in a commercial manner and is free to sell the power generated on acceptable and agreeable commercial terms - Appellant purchase the power generated in the power plant. They have priority in purchase and only after fulfilling their needs can 2nd Party sell the surplus power to third party. The thermal power plant at A-31 MIDC Industrial Area, Butibori District Nagpur is not the captive power plant of the appellant. Whether the CENVAT Credit in respect of Capital Goods, receive by the 2nd Party on the leased plot and used by them for erection/ installation of thermal power plant will be admissible to appellant for the reason that invoices showed them as consignee? - HELD TH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ks of 2nd Party, then by adopting this device Appellants could not have claimed the credit in respect of the same goods in view of Rule 4(4) of the CENVAT Credit Rules, 2004. Further appellants have submitted that credit of ₹ 1,70, 55,003/- has been denied to them in respect of the Capital Goods received in their premises after the merger of Appellants and 2nd Party with effect from 01.02.2007. We find force in the arguments of the appellant that after merger both the entities have become one and the credit cannot be denied on the ground that they were distinct earlier at time of placement of order. After merger the goods received were received by the appellants only in their premises and used by them. Hence we have to set aside the order dated 21.08.208 and remand the matter back to Commissioner for determination of CENVAT Credit to be disallowed after merger of the two entities. Whether CENVAT Credit in respect of those goods which are not identifiable but classified under Chapter 84 of First Schedule to Central Excise Tariff Act, 1985? - HELD THAT:- Since we are not adjudicating the case in relation to excisablity of the thermal power plant we do not dwell into submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o demand interest at the rate as applicable from time to time on the amount proposed to be demanded as above, from Noticee No 1, M/s Indo Rama Synthetics Ltd under Rule 14 of CENVAT Credit Rules, 2004 read with Section 11AB of the Central Excise Act, 1944. 13.02 I impose a penalty of ₹ 3,63,05,053/- [Rupees Three Crore Sixty Three Lakhs Five Thousand and Fifty Three only] on the Noticee No 1, M/s Indo Rama Synthetics Ltd under Rule 15 of CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. 13.03 I impose a penalty of ₹ 36,00,000/- [Rupees Thirty Six Lakhs Only] on the Noticee No 2, M/s Indo Rama Petrochemicals Ltd, under Rule 26 of Central Excise Rules, 2002. There shall be no penalty under Rule 27 ibid on the Noticee No 2. 1.3 Order in Original No 12/2008/C date 21.08.2008 [Appeal No E/1101/08]- 12.01 I disallow an demand an amount of ₹ 3,97,70,821/- [Rupees Three Crore Ninety Seven Lakhs Seventy Thousand Eight Hundred and Twenty One only]{i.e. ₹ 3,89,89,358/- (Basic) + ₹ 7,79,881/- (Edn Cess) + ₹ 1,582/- (S HS Cess)]towards the credit wrongly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant and an amount of ₹ 1,50,90,000/- has been shown against re-imbursement of CENVAT Credit from Appellant, which clearly showed that power plant was not the property of appellant. The goods against which the appellant has taken the credit were used by the 2nd Party for setting up the power plant. These goods were actually never received by the appellants in their factory premises. Even the payments for goods/ raw material, erection and installation of the power plant were made by the 2nd Party. Thus the CENVAT Credit taken by the appellants was irregular and inadmissible in view of Section 2(d) of Central Excise Act, 1944 read with Rule 2 (a) of Cenvat Credit Rules, 2004. iv. The final output of power plant is electricity, steam and ash which are not chargeable to excise duty or are exempt from payment of Central Excise Duty and thus the credit of duty paid on the goods used in erection of the power plant is not admissible in view of Rule 2(a) and 2(h) of CENVAT Credit Rules, 2004. v. The credit has been taken in respect of certain goods namely a. Bunker used temporarily in the boiler for storage of crushed coal; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these appeals. 3.1 In their appeal, appellants have challenged the order of Commissioner stating that- Appeal No E/526/2008 a. The capital goods against which they have taken the credit are covered by the definition of capital goods and were used in their factory premises for manufacture of final products namely polyester yarn, polyester chips etc. Hence the credit has been correctly taken by them. b. Ownership of capital goods is not relevant for taking the Cenvat Credit. As per Rule 4 of the CENVAT Credit Rules, 2004, the ownership of capital goods has not been prescribed as criteria for taking the CENVAT Credit. Reliance is placed on the decisions in case of German Remedies Ltd [2002 (144) ELT 606 (T), Maruti Udyog Ltd [2004 (165) ELT 226 (T)], Sharda Motor Industries Ltd [2002 (150) ELT 759 9T)], Hongo India (P) Ltd [2003 (160) ELT 470 (T)] Iljin Automotive Pvt Ltd [2004 (175) ELT 169 (T)]. c. All the goods on which the credit has been taken by the appellants were used in their factory since the thermal power plant is within their factory premises without any boundary wall or any fence demarcati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated at a to f and h above in this appeal too. b. The order of Commissioner denying credit in respect of items listed below for the reason that they are not covered by the definition of Capital Goods is contrary to the decisions indicated a. Bunkers Nava Bharat Ferro Alloys Ltd [2004 (174) ELT 375] b. Supporting Structures for installation of Capital Goods Ispat Industries Ltd [2006 (195) ELT 164 (T)] upheld by Bombay High Court in Central Excise Appeal No 187/2006 order dated 19.07.2007, Aditya Cement [2008 (221) ELT 362 (Raj)] c. Miscellaneous materials but classified under chapter 84 c. 2nd Party was merged with the appellant with effect from 01.02.2007, Hence the denial of credit on the ground that the same was separate entity incorrect. 4.1 We have Shri Gajendra Jain, Advocate for the Appellant and Shri Bidhan Chandra, Additional Commissioner, Authorized Representative for the revenue. Both appellant and revenue has filed the written submission in the matter 4.2 Arguing for the appellants and in his written submissions, learned counsel submitted that- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... versed. h. Since the capital goods were received in the factory premises of the appellant the reliance placed by the revenue on the decisions in case of KCP [2013 (295) ELT 353 (SC), Vikram Cement [2006 (197) 145 (SC)], Madras Cement [2010 (254) ELT 3 (SC)] Madras Cement [2010 (257) ELT 321 9SC)] is fallacious. i. Well settled that ownership of capital goods is not relevant to decide eligibility to credit . Reliance placed on decisions in case of German Remedies Ltd [2002 (144) ELT 606 (t)], Dharda Motor Industries Ltd [2002 (150) ELT 759 (T)], Maruti Udyog Ltd [2004 (165) ELT 226 (T), Sunrise Chemical Industries [2010 (262) ELT 110 (GUJ)], Modernova Plastyles Pvt Ltd [2015 (323) ELT 312 (Bom)], Iijin Automotive Pvt Ltd [2004 (175) ELT 169 (T)] j. Denial of credit on the support structures used for installation of TPP is not proper. The decision of Vandana Global [2010 (253) ELT 440 (T-LB)] relied upon by the Commissioner has been set aside by the Chhatisgarh High Court reported at [2018 (16) ELT GSTL 462 (Chhatisgarh)]. Issue is also covered by the decision in case of Mundra Port [2015 (39) STR (Guj)]. k. The decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... setting up a TPP. f. On 10.06.2005 a power purchase agreement 9PPA) is executed between the appellants and 2nd Party stating as follows: Article 3- 2nd Party to construct TPP at Butibori. Article 4- 2nd Party to Finance the entire venture. Article 5- 2nd Party to sell the electricity at a rate 12.5% below the prevailing MSE rate. Article 6- Billing and Payments was to be done as per Tariff. Invoices and Interest was applicable on overdue payment at SBI Prime Lending Rate. Article 8- Terms of Agreement was 30 years further extendable by 10 years. On default, default notice to be served. If default not remedied, Termination Notice was to be served for termination. Article 9, 10,11- Liquidated Damages, Force Majeaure and Arbitration respectively. Article 11 12- Both parties to indemnify and other Miscellaneous Provisions. Schedule 3 Appellant to give 2nd Party a No Objection Certificate. g. As per MOU executed between Appellant ad 2nd Party on 26.09.2005: Appellant sub leased 46219 sq mts of its pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... q. These facts demonstrate that 2nd Party had got the premises on lease from Appellant and as such these premises are legally not the part of premises of Appellant on which the factory of Appellant operates. These premises in terms of Section 2k(iii) and Sec 2(m) and Section 6 of the Factories Act, 1948 is a different factory belonging to 2nd Party. 2nd Party enjoys rights and privileges conferred on a lessee by Chapter V of the Transfer of Property Act, 1882. Appellants cannot lay claim to the leased premises during tenancy lease. 2nd Party also pays the lease rent to the Appellant for said premises, and also pays for all other services provided by appellant to them. r. 2nd Party is different legal and juristic person having his own liabilities and duties under various Acts. Hence the premises occupied by IRPL are not the factory of Appellant as defined in section 2 (e) of Central Excise Act, 1944 or the Factories Act, 1948 s. Legal Provisions of CENVAT Credit Rules, 2004 Rule 2(a) defines Capital Goods and prescribes that such goods must be used in the factory of the manufacturer of final products. Rule 2(h) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital goods is to be determined as per the law prevailing the time of receipt of goods. Spenta International [2007 (216) ELT 133 (TLB)] Saurashtra Chemical Ltd. [2007 (212) ELT 7 (SC)] z. CENVAT Credit availed on goods viz bunkers for storage of coal, ash handling system, structural and other goods which are either not related to manufacture at all or generation of electricity or form the part of immovable is not admissible in view of following decisions: Vandana Global Ltd [2010 (253) ELT 440 (TLB)] Saraswati Sugar Mills [2011 (270) ELT 465 (SC)] aa. A thermal power plant is not excisable goods. The plant is built/ erected by using components and machinery received. Hence there can be no credit available on goods received, by considering them as parts and components of capital goods. Tower Vision India Pvt Ltd [2016-TIO-539- CESTAT-DEL-LB] Virdi Brothers [2007 (207) ELT 321 (SC)] GVK Industries Ltd [2005 (182) LT 364 (T)] Spectrum Power Generation Ltd [2004 (177) ELT 968 (T)] bb. Appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.3.2 Para 9 of the Show Cause Notice dated 5.02.02007 reads as follows: 9. Inquiries were caused the Regional Officer, Maharashtra Industrial Development Corporation, Nagpur to ascertain the title of the land on which the power plant is being set up. The Regional Officer, MIDC, vide letter issued under F No MIDC/RO/Butibori/112/2007 dtd 08.01.2007 informed that M/s Indo Rama Synthetics Ltd having plot No A-31, in Butibori Industrial Area has applied for sub letting of plot area 46219 sq mtr to M/s Indo Rama Petrochemicals Ltd., for manufacturing of Co-generation Thermal Power Plant. It was also reported vide the same letter that as per norms of the Corporation, the said land for period from 01.04.2006 to 31.03.2007 was sanctioned on sub lease basis. He also enclosed copies of letters written by M/s Indo Rama Synthetics Ltd., approval letter dated 29.03.2006, copy of confirmation letter dated 31.03.2006 and copies of letters/ no objection certificates of UTI, SBI, ICICI, BOU, PNB OBOC conveying their no objection to granting of sub lease rights to the Noticee No 2 for the said piece of land admeasuring approx. 11.50 acres earmarked out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, for enjoyment and undertaking any commercial or production activities. The claim of the appellant that the said plot has not been segregated by the fence or boundary wall do not has any merits because the said plot of land has been clearly identified and earmarked in the land records as has been stated by the MIDC (Copy of the letter dated 31.03.2006 of MIDC reproduced below): 5.3.5 The fact that the plot of land on which the Thermal Power Plant was located belonged to 2nd Party and is not part of the factory premises of the Appellant, is evident from the para 02.01 of the impugned order wherein it has been recorded:- 02.01 The Noticee No 1 submitted a revised ground plan of its factory premises to the Range Superintendent, Central Excise Range, Butibori on 16.10.006. During the course of verification of the same by the Range Superintendent, Butibori the authorized representative of the Noticee No 1 informed that the area where the thermal power plant is being erected belongs to Noticee No 2. He further admitted that there was no board displaying the name of Noticee No 2 in the area of power plant. The above proceedings were recorded under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y agreed by the parties and form part of the Definite Power Purchase Agreement to be executed between the parties. vi) IRSL has agreed to share common utilities, common infrastructure, common fire fighting facilities and uninterrupted water supply for fire fighting from common storage with IRPL for 2 X 15 MW power plant on the basis of net block ratio. vii) The contract is valid for the period 1.04.2005 to 31.03.2010 and will automatically expired on 31.03.2010 and may be renewed for subsequent period on mutually accepted terms and conditions. viii) The parties are free to include any common infrastructure, facilities, utilities which are not specifically mentioned under this agreement on mutually accepted terms. 5.3.8 Commissioner has examined the Power Purchase Agreement in his order in para 06.10.01 and 06.10.02 stating as follows: 06.10.01 A perusal of the power purchase agreement indicates that the Noticee No 2 has entered into an agreement with Noticee No 1, for sale of electricity generated in its power plant on negotiable basis. At Article 5 of the said agreement it is clearly mentione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ombay High Court held- 21. The fact that the residential complexes are situated within the licensed premises would not entitle the assessee to avail credit of duty paid on furnace oil used in the manufacture of electricity supplied to the residential complexes. It is necessary to establish that the electricity is used for any purpose connected with or related to the production of final products. In our opinion, supply of electricity to the residential complexes situated within the factory premises are neither connected with or related to the production of the final products. In this view of the matter, we hold that the finding recorded by the Tribunal that the assessee is not entitled to the credit of duty paid on the furnace oil used in the generation of electricity supplied to the residential complexes cannot be faulted. 22. The decision of the Apex Court in the case of Grauer and Weil (I) Ltd. v. CCT (supra) and the case of South Eastern Coalfields Limited v. CCE (supra) relied upon by the assessee do not support their case. What is held in those cases is that the words any premises including the precincts thereof in Section 2(m) of the Cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect to it, clearly erroneous. 15.It has to be considered in the present case whether the workshop in question is said to be a workshop within the precincts of a mine. 16.The word precincts is not a word of clear import which has a single, clear-cut meaning. Collin s English Dictionary defines precincts to mean the surrounding region or area . 17.In the New Shorter Oxford English Dictionary, the word precinct is shown to have several meanings among which are the following : The area within the boundaries (real or imaginary) of a building or place; the grounds; the interior; esp. an enclosed or clearly defined area around a cathedral, college, etc. Also, the surroundings or environs of a place. 18.In the Advanced Law Lexicon, 3rd Edition, by P. Ramanatha Aiyar, the word precinct has been shown to have several meanings including a space enclosed by walls or other boundaries. 19.In Black s Law Dictionary, 7th Edition, the word precinct is defined as follows : A geographical unit of government, such as an election district, a police district, or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the same management. In our view since the thermal power plant at material time at least before the merger of 2nd Party with Appellant was under a distinct management and was owned by the distinct company, even if located on the same plot cannot be said to part of the manufacturing operations of Appellant. 5.3.13 From the above it is quite evident that the- i. Thermal power plant erected at A-31 MIDC Industrial Area, Butibori District Nagpur, has been erected on the plot which do not form the part of factory premises of the Appellant. ii. Appellant neither owns that thermal power plant nor operates and maintains the same. iii. All the statutory permissions required for setting up and operating the Thermal Power Plant at the aid premises have been obtained by and granted to 2nd Party. iv. 2nd Party has constructed, erected, owns, operates and maintains the thermal power plant strictly in a commercial manner and is free to sell the power generated on acceptable and agreeable commercial terms. v. Appellant purchase the power generated in the power plant. They have priority in purchase a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Indo Rama Synthetic (India) Limited (IRSL) and other Group Companies at mutually agreed tariff and terms. 5) Certain expenses amounting to ₹ 3181806/- (Previous Year) have been debited by IRSL according to the arrangement entered between the companies for the use of common utilities and facilities, the same has been charged to respective heads of accounts. 10) Capital Work in progress (CWIP) includes construction/ capital material at site, building under construction, site development expenses, plant and machinery under erection etc. From the above facts as mentioned in the balance sheet of the 2nd Party it is quite evident that the Thermal Power Plant Project at Butibori was being implemented by them and all the expenditure towards the procurement of the goods etc was incurred by them on their own account and not on the account of Appellants. It is also evident that these expenses were being met by them through the funds mobilized by them through bank loans etc. Also they were the fixed assets of their and were used to secure the loans taken by the banks. In view of above we do not have any hesitation in holding that c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts. Q. What are the activities of Indo Rama Synthetics Ltd., Butibori? Ans. M/s Indo Rama Synthetics Ltd. is a manufacturer of of Yarn of Polyesters and is selling the same. Q. What are the activities of Indo Rama Petrochemicals Ltd.? Ans.- Indo Rama Petrochemicals Ltd. is at present installing Power Generating Plant. Till date they have not started generating electricity. It is their first power project which is yet to commence generating electricity. Q What is the purpose for installing power generating plant by Indo Rama Petrochemicals Ltd.? Ans.- The purpose for setting up power generating plant at IDC, Butibori is to supply the power to Indo Rama Synthetics Ltd at mutually agreed tariff and terms. Q. Whether the power so generated by Indo Rama Petrochemicals Ltd. is given to the group companies at specific rate? Ans.- Yes. The Power that would be generated will be given to the group companies at mutually agreed rates. Q. Whether the balance sheets of both the companies Indo Rama Synthetics Ltd. and Indo Rama Petroche ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs of capital goods of power plant to specifically mention the name of Indo Rama Synthetics Ltd., as consignee and account/ customer s name as Indo Rama Petrochemicals Ltd. on the invoices at the instance of Indo Rama Synthetics Ltd.? Ans. Indo Rama Petrochemicals Ltd. being the company setting up the power plant within the premises of Indo Rama Synthetics Ltd. and the power generated is solely for consumption by Indo Rama Synthetics Ltd and group companies the documents were drawn as consignee as Indo Rama Synthetics Ltd. and the buyer as Indo Rama Petrochemicals Ltd. Q. Whether the power plant is the property of Indo Rama Synthetics Ltd.? Ans.- No. It is the property of Indo Rama Petrochemicals Ltd. only. Q. Whether Indo Rama Synthetics Ltd has shared any amount towards installation of power project? Ans.- No. Q. Whether you are paying Service tax on Goods Transport Agency for the goods received in to Indo Rama Petrochemicals Ltd. by your vendors in their name or in the name of M/s Indo Rama Synthetics Ltd. for installation of power plant? Ans.- No. We hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 90, heading No 6802 and sub heading No 6801.10 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) moulds and dies, jigs and fixtures; (v) refractories and refractory materials; (vi) tubes and pipes and fittings thereof; and (vii) storage tank, 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; RULE 3. CENVAT credit. - (1) A manufacturer or producer of final products or a [provider of output service] shall be allowed to take credit (hereinafter referred to as the CENVAT credit) of (i) to (x) . paid on (i) any input or capital goods received in the factory of manufacture of final product or the provider of output service on or after the 10th day of September, 2004; and (ii) .. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when the goods have not been received by the manufacturer in his factory the credit would not be admissible to him. 5.5.3 Appellants have relying on various case laws specifically in case of JSW Steel [2014 (307) ELT 929 (T)] argued that the CENVAT Credit cannot be denied to them as Goods on which the credit has been taken by the appellants were all used in their factory since thermal power plant (TTP) is situated within the factory premises of the appellants and there is no boundary wall fence/ demarcating TTP from the factory premises. We do not find the merits in submission of the Appellants and the facts of case relied upon by the appellant are clearly distinguishable. Facts as recorded by the tribunal in its order are as follows: 8. Earlier, the main appellants were known as M/s. Southern Iron and Steel Company Ltd. ( SISCOL - in short), which was established in 1996 and was in working condition till 2002. M/s. SISCOL was also brought under Restructuring Scheme under Corporate Debt Restructuring ( CDR - in short). Thereafter, M/s. SISCOL was declared a sick company and was brought under BIFR. Therefore, in order to enable them to get the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT credit and M/s. Majestic Auto Ltd., have got manufactured the parts on job work basis from M/s. Hero Briggs Stratton Auto Pvt. Ltd. In this case, the facts are that a part of the land has been leased out to M/s. JSWPL for installation of CPP which is being used by the appellants for manufacturing of their final products. There is no contract between the appellants and M/s. JSWPL for generation of electricity in the CPP by M/s. JSWPL and was to be sold to the appellants. In fact, M/s. JSWPL was leased out land for installation of CPP only. Therefore, the decision in the case of M/s. Majestic Auto Ltd., cannot be relied on in the facts of this case and the decision of M/s. Majestic Auto Ltd. (supra) was also dealt with by that Tribunal in the case of M/s. Steel Authority of India Ltd. - 2007 (219) E.L.T. 960 (Tri.-Del). Further, we find that the learned JCDR also relied on the decision of M/s. Chemplast Sanmar Ltd. - 2004 (177) E.L.T. 446 (Tri.-Chennai), this Tribunal hold that although M/s. Chemplast Sanmar Ltd., is not the manufacturer of power plant but finally credit on the capital goods was allowed. Therefore, as in this case also the final product is iron and steel. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany, say X by Y company, who are now in possession of the said premises, it cannot be claimed by Y company that the capital good are used in their factory. The capital goods are no more installed in the factory of the Y . In this regard I place reliance on the decision of the Hon ble Tribunal in the case of Majestic Auto Ltd vs CCE Ghaziabad reported in 2004 (173) ELT 145 (tri-Del)], wherein it has been held in para 6.1 to 6.3 as under;- 6.1 We have considered the submissions of both the sides. It is not disputed by the learned Advocate that both the appellants are separate limited companies and as such they are two different legal entity, though they may belong to same group. It is also not in dispute that the Appellant No. 1 have taken the Modvat credit of the duty paid on the capital goods in question and the premises in which the said goods are installed had been given on lease to the Appellant No. 2. This is also very clear from the Lease Agreement that the Lessee i.e. Appellants No. 2 shall enjoy the Demised Premises during the lease period without interruption by the lessor (i.e. Appellant No. 1). In terms of the Lease Agreement, the Appellants No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant remained installed in the same premises, which was leased out and continued to be engaged in the manufacture of I.C. Engine, which was further used in the manufacture of two wheelers and that a separate registration certificate was obtained by HBSA Pvt. Ltd., there was no removal of goods. The capital goods remained installed in the same premises and thus even if the premises were transferred on lease, the capital goods even if they were deemed to be installed in the premises of HBSA Pvt. Ltd., Rule 57-S, would not be attracted. We do not find merits in submissions of the Counsel. It is not disputed that the decision of tribunal in case of Majestic Auto has been set aside by the Allahabad High Court, however the issue of relationship of lessor and lessee has not been set aside. It is seen that in the premises of leased out, when registration was granted the plant and machinery which was owned and installed by the Lessor was clearly demarcated, and never removed from that premises, for that reason High Court has set aside the order of tribunal stating that since machinery continued to be installed within the factory premises provisions of Rule 57S shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee by taking the premises in which the power unit was installed on long term lease and generating the power. Therefore, it is clear that the said purchaser, after purchasing the power unit from the assessee, has been enjoying the same as its absolute owner and has been supplying to the assessee the power generated from the said power unit on payment basis. This being so it is quite evident that the assessee-company lost its ownership and also control over the said power unit by selling it to the said purchaser for valid consideration and by giving to the purchaser on long term lease the premises in which the said unit is installed so as to enable the purchaser to run the unit at the same premises of the assessee as its absolute owner, generate power and sell the power so generated to the assessee-company itself. 6. Therefore, in our considered view though there had been no physical removal of power unit the above transactions between the assessee-company and M/s. Tata Electric Company certainly amount to nothing short of physical removal of the power unit of the assessee in respect whereof MODVAT credit was availed by the assessee so as to attract the pena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case Spenta International [2007 (216) ELT 9Tri-LB)] it has been held 7. In the case of Binani Cement Ltd. v. CCE, 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 Roshni decision and the Grasim Industries decision as well as the Sengunthar decision, to hold that the relevant date for determination of availability of Modvat credit is the date of receipt of capital goods in the factory and if on that date no credit was available, it cannot be allowed subsequently. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hem. Hence we have to set aside the order dated 21.08.208 and remand the matter back to Commissioner for determination of CENVAT Credit to be disallowed after merger of the two entities. 5.6 Whether CENVAT Credit in respect of those goods which are not identifiable but classified under Chapter 84 of First Schedule to Central Excise Tariff Act, 1985. 5.6.1 The next issue is with regards the admissibility of credit in respect of supporting structures used for installation of boiler etc, bunkers for storage of coal, ash handling system, system and other miscellaneous goods. 5.6.2 We are in agreement with the submissions made by the appellant that decision of the larger bench of Tribunal in case of Vandana Global Ltd [2010 (253) ELT 440 (Tri- LB)] has been set aside by the Hon ble Chhattisgarh High Court as reported at [2018 (16) GSTL 462 (Chhattisgarh)]. Similar view has been expressed by the Gujarat High Court in the case Mundra Port [2015 (39) STR 726 (Guj)]. However since the credit has been sought to be denied for the reason of that the goods were not received by the appellants and were used by them for the process of production of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd purchase of capital goods, inputs. No description of goods purchased by the assessee is reflected in the prescribed ER1 returns. Only the figures of duty paid and Cenvat credit taken are reflected in the returns. The responsibility of assessing the correct duty liability on the clearance of final products and taking of credit on eligible goods lies only with the assessee. It is specifically provided in Rule 9 Cenvat Credit Rules 2004 that the assessee should take reasonable steps to take eligible credit with proper documents. The contention of Noticee No.1 is that the notices were under the bona fide belief that the items in question were covered under the definition of capital goods since they have been used in the factory of the notice even though they were not the owners of the capital goods so long as they satisfy the definition of capital goods and hence they cannot be alleged that they suppressed the facts with intent to evade duty . It is not sufficient to satisfy the definition of capital goods alone which gives the right of availing credit on ineligible credit to the assessee but they should satisfy other equally binding, mandatory and substantial conditions of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Chethar Vessels Pvt Ltd Trichy. ; and The second invoice is showing consignee as M/s Indo Rama Synthetics (I) Ltd. A-31 MIDC Industrial Area Butibori Nagpur Maharashtra, A/c M/s Indo Rama Petrochemicals Ltd. and buyer is shown as M/s Indure Pvt Ltd, M/s Indo Rama Synthetics (I) Ltd. A-31 MIDC Industrial Area Butibori Nagpur Maharashtra. The invoice itself speaks volume as to why the identity of actual purchaser and user of the said goods have been layered so as to make identification difficult. 5.8.3 In our view the charge of suppression, misstatement etc. with the intent to evade payment of duty/ take inadmissible credit is well established against the appellants. 5.8.4 Since we find that appellants have availed the inadmissible credit by suppressing the relevant and complete information from the department we also uphold the penalties imposed under Rule 15 of CENVAT Credit Rules, 2004 read with Section 11AC of Central Excise Act, 1944. 5.8.5 Since the appellants have taken the inadmissible credit the demand for interest too is sustained. 6.1 In view of ..... 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