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of <h1>Explosives and lubricating oil deemed eligible for modvat credit in recent Tribunal decision</h1> <h3>JAYPEE BELA PLANT Versus COMMISSIONER OF C. EX., BHOPAL</h3> The Tribunal allowed the appeals concerning the eligibility of explosives and lubricating oil for modvat credit. Following the Supreme Court's favorable ... Cenvat/Modvat - Inputs used in mines Issues involved: Eligibility of explosives and lubricating oil for modvat credit.Explosives eligibility: The issue in appeals E/1445/05 and E/2347/05 was the eligibility of explosives used in mines for recovering input (lime stone). The credit was denied due to the explosives being used outside the factory premises. However, following the Supreme Court judgment in Vikram Cement v. CCE, Indore, which favored the assessee, the appeals were allowed, setting aside the impugned order.Lubricating oil eligibility: The remaining seven appeals revolved around the eligibility of lubricating oil for modvat credit. These oils were used in dumpers to transport limestone from mines to the cement factory. The credit was denied on the basis that the dumpers were not used within the factory premises. The appellant argued that the Supreme Court's decision in Birla Corporation Ltd. v. CCE supported their claim, as it held that transport arrangements for bringing material to the factory were eligible for modvat credit.Dumpers as capital goods: The Tribunal had conflicting judgments on whether dumpers are considered capital goods. The appellant pointed out that the revenue had accepted a previous decision on dumpers and highlighted the Supreme Court's rulings on transport arrangements like ropeways being eligible for modvat credit. Since dumpers served the same purpose as ropeways in transporting material to the factory, the Tribunal concluded that dumpers were also eligible for modvat credit.Conclusion: The Tribunal held that credit for lubricating oil used in dumpers was available, aligning with the Supreme Court's stance on transport arrangements. Therefore, the appeals were allowed with consequential relief.
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