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TMI Blog2024 (6) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... to June 2009 (appeal No.E/2122/2011) amounting to Rs.5,68,41,048/- and Rs.3,12,89,664/- (appeal No.E/2123/2011). Consequently, show-cause notices were issued to them for alleging credit on these items is not admissible, hence recoverable with interest and penalty. On adjudication, the learned Commissioner confirmed the demands with interest and penalty. Hence, the present appeals. 3. At the outset, the learned advocate for the appellant has submitted that they have availed the cenvat credit on various inputs viz. MS angles, MS channels, MS beams, MS joists, MS plates, CTD bars etc. falling under Chapter 72 and cement falling under Chapter 25 which were used in the factory for the manufacture of capital goods such as bagasse conveyor, cane unloader, boiler, storage tanks etc. and support structures for the capital goods used in the manufacture of the dutiable goods inside the factory. He has further submitted that in the impugned order following the judgment of the Larger Bench of the Tribunal in the case of Vandana Global Ltd. Vs. CCE&C, Raipur [2010(253) ELT 440 (Tri. LB)], the learned Commissioner has held that these items do not fall under the definition of inputs. He has subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contents of the impugned order of the Tribunal and submissions of the assessee and the Revenue following substantial questions of law are formulated for consideration : (A) Whether the terms 'capital goods' excludes the structures embedded to earth? (B) Whether the goods like angles, joists, beams, bars, plates, which go into fabrication of such structures are not to be treated as 'input' used in relation to their final products as inputs for capital goods, or none of the above? (C) Is the amendment brought in CENVAT Credit Rules, 2004 as per Rule 2 of the CENVAT (Amendment) Rules, 2009 retrospective in nature considering is it clarificatory to be applied to all matters which arise before 7-7-2009, the date of commencement of the CENVAT (Amendment) Rules, 2009 : hereinafter referred to as 'Amendment Rules'. 5. The impugned order of the Tribunal had come up for consideration before different High Courts either cited as precedent or as relied upon by the Tribunal in different other matters. The Gujarat High Court in Mundra Ports & Special Economic Zone Ltd. - 2015 (39) S.T.R. 726 (Guj.) referred to the contents of the amendment, to the extent it is relevant for the purpose o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the user test, enunciated, in its earlier judgment rendered in : Jawahar Mills Limited case. Clearly, the Court held that steel plates and MS Plates, i.e., structurals used in the fabrication of the chimney, which were an integral part of the diesel generating set would fall within the ambit and scope of definition of capital goods. The Court, went on to further hold that such equipment had to be treated as an accessory. As a matter of fact, in Saraswathi Sugar Mills case, the Court, while noticing the view taken in Rajasthan Spinning and Weaving Mills Limited said that as long as it could be shown that the item in issue was an integral part of the machinery, i.e., capital goods, it would fall in the definition of 'component' and thus, by logical extension, come within the ambit of 'capital goods'. 43.1 To be noted, Hon'ble Mr. Justice D.K. Jain, (as he then was), was party to both the judgments rendered by the Supreme Court i.e., Rajasthan Spinning and Weaving Mills Limited as well as Saraswathi Sugar Mills Limited case. 43.2 Therefore, quite clearly, the two judgments referred to above cannot be read in the manner, as the Revenue is seeking to read them, that is, at cross p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to fall under such definition, when '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 2 appended thereto, it makes the position clear that inputs are not only goods, which are used in the manufacture of final products, 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 installed for manufacture of the capital goods should also be considered for availment of Cenvat credit. In the case in hand, the cement and steel bars used to erect foundations for installing differ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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