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TMI Blog2024 (5) TMI 1331X X X X Extracts X X X X X X X X Extracts X X X X ..... books of the Appellant. The said items were utilized by the Appellant for installation and fabrication of various capital goods and structural support thereof. The total quantity procured was 11516.02 MT and out of which only on 6139.259 MT CENVAT Credit was availed which amounts to Rs. 3,06,26,365/-. Also, Rs 8,10,854/- was reversed as the same was related to civil installation after physical verification by the Assistant Commissioner and Preventive Team on 08.01.2009. The detail of the credit taken on items was also furnished with the ER-1 returns filed regularly. 2.2 These articles have been used for manufacture of capital goods which were further used in the factory and are other than being used in making of factory shed, building, laying of foundation stone for or for making structure for support capital goods in which the balance quantity [11,516 MT minus 6,139 MT] was used. The Appellant got the said capital goods and structures fabricated through contractors using the aforesaid steel items for fabrication of support structures like cable trays, electricity panels, electronically operated bucket cranes, bag filters, raw mill, ball mill, cement mill, conveyor assemblies, cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ressed by the Tribunal/Courts and the matter is referred to the Larger Bench, then the extended period of limitation is not invokable. It is further submitted that in such legal complex situation, the Appellant cannot be fastened with the allegation on account of mala fide intention. 3.2 He further submitted that the period involved in the present dispute pertains to September 2008 to September 2009 [relevant time]. At that relevant time, Explanation 2 to Rule 2(k) of the CENVAT Credit Rules, 2004 provided that inputs include goods used in the manufacture of capital goods, which are further used in the factory of manufacturer. The aforesaid Rule 2(k) was amended vide the Notification No.16/2009-CE(NT) w.e.f. 07.07.2009. Explanation 2 to Rule 2(k) provides that inputs include goods used in the manufacture of capital goods which are further used in the factory of manufacturer, but shall not include cement, angles, channels, CTD bar or TMT bar and other items used for construction of company, shed, building or laying of foundation or making of structures for support of capital goods. 3.3 He also submitted that it was the amended Explanation 2 to Rule 2(k) as also the interpretation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest and also penalty on the Appellant, by relying upon the amendment in Explanation 2 to Rule 2(k) and also Vandana Global (supra) is clearly unsustainable. 9. Learned Advocate for the Appellant has further 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 not be appropriate 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. 10. To strengthen his submission, learned 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.)], ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 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. 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 cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further, we find that the Hon'ble High Court of Allahabad also accepted the view that the decision in Vadana Global (supra) was not a good law. [CCE Lucknow vs. Mankapur Chini Mills 2019 (367) ELT. 889 (All.)]. The Jurisdictional High Court held as follows:- "32 On going through the record, we find that the Revenue has relied upon the Larger Bench decision of the Tribunal in the case of Vandana Global (supra), wherein it was held that the Explanation added to the definition of capital goods w.e.f. 7-7-2009 has to be held as explanatory and thus retrospective in nature. The said decision of the Tribunal was considered by the Hon'ble Gujarat High Court in the case of Mundra Ports & Special Economic Zone Ltd. (supra), wherein the said decision was not approved by the Hon'ble High Court and observed that the amendment made on 7-7-2009 cannot be held to be clarificatory and as such would be applicable only prospectively. 33. The Madras High Court in India Cement (supra) noticed Vandana Global (supra) but relied upon the Apex Court judgment in Rajasthan Spinning & Weaving Mills Ltd. (supra), wherein the Apex Court has considered an issue of steel plates and MS channels ..... X X X X Extracts X X X X X X X X Extracts X X X X
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