2007 (3) TMI 10 - SC - Central Excise

Supreme Court grants Modvat/Cenvat credit on capital goods for ropeway spares.

BIRLA CORPORATION LTD. Versus COMMISSIONER OF C. EX., RAIPUR

The Supreme Court allowed the appeal, setting aside the Tribunal's order and granting the assessee-appellant the right to claim Modvat/Cenvat credit on ... Cenvat/Modvat – In tribunal decision the appellant was not entitle to modvat/Cenvat on capital goods(Spares of ropeway) – After considering prior cases authority decided in favour of appellant and set aside the order passed by tribunal Issues:Entitlement to Modvat/Cenvat on capital goods - spares of ropeway used for conveying crushed limestone from Crusher to the factory.Analysis:The appeal before the Supreme Court was against the Judgment and Final Order of the Customs, Excise and Service Tax Appellate Tribunal, New Delhi. The main issue was whether the appellant was entitled to Modvat/Cenvat on capital goods, specifically spares of ropeway used for conveying crushed limestone from the Crusher to the factory where cement is manufactured. This issue had already been addressed in previous judgments by the Supreme Court in cases such as Birla Corporation Ltd. v. Commissioner of Central Excise and Commissioner of Central Excise, Nagpur v. Manikgarh Cement Ltd. In the latter case, it was noted that there was an inadvertent mistake in the order where the Court said the appeal of the Department was allowed instead of dismissed. The counsel for the revenue conceded that the appeal filed by the assessee deserved to be allowed based on the previous judgments. The Supreme Court, following the views in the mentioned cases, accepted the appeal and set aside the Tribunal's order, allowing the assessee-appellant to claim Modvat/Cenvat credit on the capital goods, which were the spares of the ropeway. The appeal was allowed with no order as to costs.