CENVAT credit on capital goods depends on receipt in the factory and use in manufacture, not ownership or installation conditions.

CENVAT credit on capital goods is available to a job-worker when the goods are received in its factory and used in the manufacture of final products. The rules do not require the recipient to be the owner of the capital goods, and they do not make installation in the principal manufacturer's premises a condition for credit. On the stated facts, the capital goods were used in the respondent's factory and there was no double availment of credit, so denial of credit was unjustified.

---

---

Issues: Whether CENVAT credit on capital goods is admissible to a job-worker when the capital goods are owned by the principal manufacturer and are used in the job-worker's factory without being installed in the principal's premises.

Analysis: Rule 2(b) of the CENVAT Credit Rules, 2002 defines capital goods, and Rule 3(1) allows credit to a manufacturer or producer of final products in respect of duty paid on inputs or capital goods received in the factory. The rule makes receipt of the capital goods in the factory and their use in the manufacture of final products the relevant conditions. It does not impose any requirement that the recipient must be the owner of the capital goods, nor does it prescribe installation as a condition for availing credit. On the admitted facts, the capital goods were received in the respondent's factory and used in manufacture, and there was no double availment of credit.

Conclusion: CENVAT credit was admissible, and the denial of credit was not justified.

Final Conclusion: The Revenue's challenge failed because no substantial question of law arose from the Tribunal's view on admissibility of credit.

Ratio Decidendi: Under the CENVAT Credit Rules, 2002, entitlement to credit on capital goods depends on receipt in the factory and use in manufacture of final products, not on ownership of the capital goods or their installation in the owner's premises.

---