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TMI Blog2025 (3) TMI 855X X X X Extracts X X X X X X X X Extracts X X X X ..... ther parts" ,whether in respect of "Metal-Rolling Mills" or in respect of "Rolls for the Metal Rolls" would get classified therein. Thus it is clear that "Rolls for rolling mills" are independent goods are in the nature of "Capital Goods" and are not in the nature of "Spare Parts". In the present litigation, it is not the case of the Revenue that the imported goods are classifiable under CTH 8455 90 00. The appellant has adopted CTH 8455 30 00 in their Bills of Entry [sample verified by the Bench] and the Revenue has cleared the same. Even in the present proceedings, the classification is not disputed by the Revenue. An identical issue was before this Bench in the case of Comm. of Customs (Port), Kolkata vs. M/s. Cosmic Ferro Alloys Limited, [2024 (8) TMI 674 - CESTAT KOLKATA]. In that case, the goods in question were "Roller Sets", "Blades for Slitting Machines", "Spacers" & "Spares for Cold Rolling Mills" and the issue was whether the import of such goods would be be covered by the definition of "Capital Goods" under Notification No. 104/2009-Customs dated 14.09.2009. This Bench has held that 'the goods imported are squarely fitting within the definition of 'Capital Good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... horized Representative for the Respondent ORDER PER R. Muralidhar : The Appellant are manufacturers of stainless steel items such as slabs, hot rolled steel coil, cold rolled steel coil etc. falling under Chapter 84 of the Central Excise Tariff Act, 1985. Work Rolls are used in Rolling Mills in the factory of the Appellant to ensure movement and processing of products such as slabs into plates, HR Coils/Sheets, CR Coils/Sheets etc. 2. In 2013-14 and 2014-15, the Appellant purchased a total of 8 duty credit scrips issued under the Status Holder Incentive Scheme (SHIS Scheme) from various status holders. Out of such scrips, the Appellant completely used 5 of them and 42% of the 6th scrip to import "Work Rolls" by classifying the same under CTH 8455 30 00 as "Capital Goods" and availing the benefit of Notification No. 104/2009-Customs dated 14.09.2009. 3. Based on the investigation taken up by DRI, a SCN was issued alleging that imported "Work Rolls" are not standalone Capital Goods. Since they are only "Parts or Spares of Capital Goods" of Rolling Mills. As per the terms of Notification No. 104/2009-Customs dated 14.09.2009, only 10% of the value of the scrips should have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Incentive Scheme [SHIS] scrips purchased by the appellant, which were used to pay the Customs Duties towards the import of the Work Rolls. (9) The definition of "Capital Goods" as given in the Explanation to the Notification No. 104/2009-Customs dated 14.09.2009 (SHIS Scheme Exemption) is extracted hereunder for the purpose of reference: ""Capital goods" means any plant, machinery, equipment or accessories required for manufacture or production, either directly or indirectly, of goods or for rendering services, including those required for replacement, modernization, technological up gradation or expansion. It also includes packaging machinery and equipment, refractories for initial lining, refrigeration equipment, power generating sets, machine tools, catalysts for initial charge, equipment and instruments for testing, research and development, quality and pollution control. Capital goods may be for use in manufacturing, mining, agriculture, aquaculture, animal husbandry, floriculture, horticulture, pisciculture, poultry, sericulture and viticulture as well as for use in services sector." (10) It is submitted that the definition of capital goods are wide enough to include ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Notice issued on 28.10.2015 for the scrips used during the period 28- 08-2014 to 17-01-2015, is time barred in respect of the part of the demand. It is submitted that the appellants were importing the Works Rolls as Capital Goods under EPCG scheme, which was allowed by the Revenue. Further, they have accounted for the Works Rolls as Capital Goods in their Balance Sheet, which has the approval of the Income Tax Dept. Further, as all the details are properly recorded, there is no case of suppression made out by the Dept. Hence, he submits that the confirmed demand for the extended period is required to be set aside even on account of time bar. 5. The Ld AR representing the Revenue submits that the Notification No. 104/2009-Customs dated 14.09.2009 , specifically mentions at Para 4 that in respect of "Parts or Spares of Capital Goods", only 10% of the value of the scrips could be used for payment of duty. The appellant has contravened this provision. Hence, he justifies the confirmed demand. 6. Heard both the sides and perused the Appeal papers, Synopsis and other documents placed before. 7. The issue to be resolved in this case is as to whether, the Works Rolls imported by the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espect of both. We find that in respect of SHIS scrip itself, the Chennai Tribunal in the case of Comm. of Cus., Chennai vs. JSW Steel Ltd., 2016 (340) ELT 262 (Tri-Chennai), has held as under : "8. In this regard, we find the Notification No. 104/2009-Cus., dated 14-9-2009 clearly allows exemption of capital goods imported into India against Duty Credit Scrip issued under SHIS Scheme. As per Para 3.16 of Foreign Trade Policy the definition of "capital goods" and the definition of "capital goods" as provided in the Explanation under the Notification 104/2009-Cus. are identical to the definition given in the FTP and covers capital goods "plant, machinery, equipment or accessories required for manufacture, production, either directly or indirectly, of goods and includes those required replacement, modernization, technological upgradation or expansion etc. On a perusal of the contract, it is abundantly clear that respondents are setting up the plant and machinery of the Expansion Project for CAL & CGL in the Cold Rolling Mill Complex. It is pertinent to state that respondent has set up integrated steel plant at Vijayanagar, Karnataka. The contract clearly shows the import of entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al goods. In the present case we find that the licensing authority themselves have allowed titanium sheets as capital goods in the EPCG license. Once, it is held that, it is capital goods under EPCG license, a different stand cannot be taken for clearance through SHIS scrip. The SHIS refers to the definition of capital goods as per para 9.12 of FTP and the definition under customs notification, are identical to para 9.12 of FTP. Therefore, we hold that the goods are covered under capital goods... " 14. Therefore, we see considerable force in the appellant"s argument that Revenue cannot adopt two different standards to deny the benefit, as has been held in the above cited decision. On this count itself we set aside the impugned order and allow the appeal on merits. 15. Further we also observe identical issue was before this Bench in the case of Comm. of Customs (Port), Kolkata vs. M/s. Cosmic Ferro Alloys Limited, 2024 (8) TMI 674 - CESTAT KOLKATA. In that case, the goods in question were "Roller Sets", "Blades for Slitting Machines", "Spacers" & "Spares for Cold Rolling Mills" and the issue was whether the import of such goods would be be covered by the definition of "Capital Goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a better footing. While in that case, the issue was as to whether the "spare parts" can be considered as Capital Goods for the eligibility to use the SHIS scrip, in the present case, we have already held the goods in question are Capital Goods and are not mere "spare parts". Hence, we have no hesitation in applying the decision of this Bench to hold that the impugned order is not legally sustainable. Accordingly, we set aside the same and allow the appeal on merits. 17. The appellant has also argued to the effect that the Show Cause Notice has been issued belated and accordingly the confirmed demand for the extended period is required as hit by time bar. We find that the issue as to whether even the Spare parts per se can be treated as Capital Goods, when they were treated as Capital goods for EPCG clearances, was under litigation. As we have observed in the above paragraphs, the Tribunals have held that the importer would be eligible to use the SHIS scrip. Thus the bonafide belief of the appellant gets fortified by the Tribunal"s decisions. Hence, the issue being that of interpretation, the Revenue is not justified in fastening the suppression clause on the appellant. Accordingly ..... X X X X Extracts X X X X X X X X Extracts X X X X
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