CEGAT Grants Modvat Credit for Capital Goods Fixed to Earth

The Appellate Tribunal CEGAT, New Delhi allowed the appeal filed by the Appellants, granting them Modvat Credit of Rs. 7,71,311.00. The dispute centered on the excisability of capital goods (sulphur melter) permanently attached to the earth. The Tribunal held that once goods are fixed in a manner making removal impossible, they are considered part of the tank and subject to excise duty. Consequently, the Appellants were entitled to the credit as capital goods.

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The Appellate Tribunal CEGAT, New Delhi allowed the appeal filed by the Appellants against the order denying Modvat Credit of Rs. 7,71,311.00. The dispute was regarding the excisability of capital goods (sulphur melter) permanently attached to the earth. The Tribunal ruled in favor of the Appellants, stating that once goods are manufactured and fixed in a way they cannot be removed, they become part of the tank and are liable to excise duty. The benefit of credit as capital goods was granted to the Appellants.

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