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TMI Blog2023 (4) TMI 321X X X X Extracts X X X X X X X X Extracts X X X X ..... MILLS LTD. [ 2010 (7) TMI 12 - SUPREME COURT] , wherein the Apex Court has considered an issue of steel plates and MS channels used in the fabrication of chimney for diesel generating set and after considering it, the Apex Court allowed the Cenvet credit on MS Rod, sheets, MS Channel, MS Plate, etc., used for fabrication of structures to support various machines/capital goods. In M/S. THIRU AROORAN SUGARS, M/S. DALMIA CEMENTS (BHARAT) LTD. VERSUS CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, THE COMMISSIONER OF CENTRAL EXCISE [ 2017 (7) TMI 524 - MADRAS HIGH COURT] , a Division Bench of the Madras High Court specifically considered as to whether MS structural, (which support plant and machinery), cement and steel (which are used in erecting foundations to hold plant and machinery) are integral part of capital goods eligible for Cenvat credit under the Cenvat Credit Rules, 2004 prior to the amendment of Explanation 2 to Rule 2(k) by notification dated 7-7-2009. The Madras High Court has held that irrespective of whether user test is test applied, or the test that they are an integral part of the capital goods is applied, all such items fell within the scope and ambit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as proposed in the Show Cause Notice and recorded that- (a) the structures which are fabricated from the subject goods do not qualify to be capital goods under Rule 2(a)(A)(i) to (iii) of the CENVAT Credit Rules, 2004; (b) The assessee failed to prove that structures fabricated from the subject goods satisfy the description or classification prescribed in the definition of capital goods in Rule 2(a) of the CENVAT Credit Rules. 3. Penalty of equal amount was also imposed under Rule 15(2) of the CENVAT Credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944. Being aggrieved, the Appellant has filed the present Appeal before this Tribunal. 4. The Ld.Advocates, appearing on behalf of the Appellant, submitted that the findings in the impugned order that the Appellant failed to substantiate usage of the subject goods in its factory in or in relation to manufacture is factually incorrect as the Chartered Engineer s Certificate proves that the subject goods were used within the factory of the Appellant. He further submitted that the period involved in this case is from 2005-06 to April 2008 and the Show Cause Notice was issued on 15.05.2009 which i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d also Vandana Global (supra) is clearly unsustainable. 10. Ld.Advocate for the Appellant has next submitted that circular dated 2-4-2012 has been issued in the context of the amended definition of inputs under the Cenvat Credit Rules, 2004. Rule 2(k) was substituted by the Notification No. 3/2011-C.E. (N.T.), dated 1-3-2011 and a specific exclusion was provided for goods used for laying of foundation or making of structures for support of capital goods. It was in the context of the amended definition (w.e.f. 1-3-2011) of inputs in Rule 2(k), the Circular dated 2-4-2012 was issued. It would be hazardous to rely upon the Circular dated 2-4-2012 to interpret the scope of inputs as it stood during the period 2005-06 to August, 2008, when the statutory framework was entirely different. 11. To strengthen his submission, Ld.Advocate for the Appellant has also relied upon Commissioner of C.Ex., Jaipur v. Rajasthan Spinning Weaving Mills Ltd. [2010 (255) E.L.T. 481 (S.C.)], Commissioner of C.Ex. Tiruchirapalli v. India Cements Ltd. [2012 (285) E.L.T. 341 (Mad.)], Mundra Ports Special Economic Zone Ltd. v. C.C.E. Cus. [2015 (39) S.T.R. 726 (Guj.)], and Thiru Arooran Suga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provided for goods used for laying of foundation or making of structures for support of capital goods. Rule 2(k) as substituted w.e.f. 1-3-2011 reads as under : 2(k) input means, - (a) all goods used in the factory by the manufacturer of the final product; or (b) any goods including accessories, cleared along with the final product, the value of which is included in the value of the final product and goods used for providing free warranty for final products; or (c) all goods used for generation of electricity or steam (or pumping of water) for captive use; or (d) all goods used for providing any (output service); or (e) all capital goods which have a value up to ten thousand rupees per piece, but excludes - (A) light diesel oil, high speed diesel oil or motor spirit, commonly known as petrol; (B) any goods used for- (a) construction or execution of works contract of a building or a civil structure or a part thereof; or (b) laying of foundation or making of structures for support of capital goods, except for the provision of service portion in the execution of a works contract or construction service as listed under clause (b) of Section 6 ..... 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