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TMI Blog2023 (3) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... ER NOS. 50243-50244 /2023 - Dated:- 23-2-2023 - MR P. V. SUBBA RAO, MEMBER (TECHNICAL) AND MS BINU TAMTA, MEMBER (JUDICIAL) Present for the Appellant : Shri O P Bisht, Authorised Representative Present for the Respondent: Shri B L Narasimhan and Ms. Sukriti Das, Advocates ORDER The revenue has filed the present two appeals in respect of the two units of the assessee, i.e, Unit-1 and Unit-2 challenging the Order-in-Original No. ALW-EXCUS-O-I-O-COM05 to 30/19-20 dated 5.3.2020, whereby the learned Commissioner dropped the demands of CENVAT credit on tubes and flaps. 2. The assessee is engaged in the manufacture of automobile tyres falling under chapter 40 of the First Schedule of the Central Excise Tariff Act, 1985. (CETA). The assessee was domestically clearing such tyres along with tubes and flaps by paying central excise duty on the value of the entire set packing, i.e. tyres, tubes and flaps. They were also exporting these items. The assessee, therefore, availed the CENVAT credit of duty paid on purchase of such tubes and flaps. 3. Before adverting to the present proceedings, it would be justifiable to appreciate that the issue raised now stands cove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove, that the sockets were fitted on the said m.s./g.i. pipes before their clearance. It has been concurrently found by the Commissioner as well as by the Tribunal that the sockets were fitted on the threaded portion of the pipes. It has been found that the said sockets enabled the functioning of the pipes. It is found that the sockets were essential for functioning of the pipes. They were required for joining the pipes to each other. In the circumstances, the functional test stood fully satisfied in this case and consequently, the cost of the said sockets was includible In the assessable value of the said m.s./g.i. pipes. On behalf of the appellant, it has been contended that the test of essentiality is not the correct test. We do not find any merit in this argument. We have applied the test of essentiality in several cases, particularly in order to distinguish a component from accessory. According to Chambers Science Technology Dictionary socket‟ is defined as a pipe end enlarged to pass over a same-sized pipe to make a joint. Therefore, sockets not only contributed to the functioning of the pipes, it constituted a part of m.s/g.i. pipes. As stated, the customer was cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nufactured and sold by them does not entitle them to claim CENVAT credit. The said judgement of the High Court of Kerala was relied on by the revenue, in the case of the assessee in the earlier round of litigation, however, the same was distinguished by the High Court of Rajasthan. We have also been apprised that the judgement of the Kerala High Court has been appealed before the Hon‟ble Supreme Court by Apollo tyres and the same has been stayed. 7. We are of the considered view that the decision of this Tribunal as well as of the High Court of Rajasthan in the case of the assessee itself holding that CENVAT credit on duty paid tubes and flaps as accessories of manufactured tyres is admissible, is binding on us. Therefore, the issue having been held in favour of the assessee, the present appeal by the revenue needs to be dismissed and the order passed by the Adjudicating Authority is consequently upheld. 8. The learned counsel for the assessee has raised objections to the averments made at Page XIV- XV in the appeal filed by the revenue to the effect: In the instant case, Civil Appeal is pending in the Honourable Supreme Court against the adverse judgement of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appropriate to refer to the decision of the Supreme Court in Union of India vs. Kamlakshi Finance Corporation Ltd[AIR 1992 SC 711] . The order passed by the Assistant Collector not only ignored the order of the Collector (Appeals) remanding the matter, but also distinguished the decision of the Tribunal by observing that the decision of the Tribunal had not been agreed to by the Department as an appeal had been filed in the Supreme Court. The assessee filed a writ petition in the Bombay High Court to challenge the said order of the Assistant Collector. The High Court not only quashed the order passed by the Assistant Collector but also directed the Department to allocate the matter to a competent officer for passing a proper order. It is against this decision of the Bombay High Court that the Union of India preferred an appeal before the Supreme Court. The Supreme Court remarked that as the Assistant Commissioner had not followed the decision of the Tribunal merely because an appeal had been filed by the Department before the Supreme Court, the High Court had rightly criticised the conduct of the Assistant Collector since it resulted in harassment to the assessee caused by the fai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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