2013 (10) TMI 844 - AT - Central Excise

Appellant granted partial credit in CENVAT case, compliance crucial for waiver

SREE RAYALASEEMA SUGAR & ENERGY PVT LTD. Versus CCE TIRUPATI

The judge in the case addressed the eligibility of the appellant for CENVAT credit on materials used for supporting structures and equipment connections. ... Waiver of Pre-deposit - CENVAT Credit – Held that:- Relying upon Vandana Global Ltd. Versus CCE [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] - it is also noticed from the records that in addition to supporting structures, there are items used for connecting pipelines, evaporators, etc. - Therefore the appellant may not have a 100% case but definitely a portion of the credit would be admissible - the appellant is directed to deposit 50% of the CENVAT credit demanded – upon such compliance there shall be wavier of pre-deposit of the balance and stay against recovery during the pendency of appeal – Partial stay granted. Issues Involved:Whether the appellant is eligible for CENVAT credit on duty paid on MS angles, channels, beams, HR plates, coils, steel tubes, etc., used for supporting structures, platforms for the equipment, and interconnecting pipelines to the equipment like evaporators, sugar melting systems.Analysis:The judgment delivered by SHRI B.S.V. MURTHY addresses the issue of eligibility for CENVAT credit on specific materials used for supporting structures and equipment interconnections. The appellant's counsel relied on precedents, including decisions from the Hon'ble High Court of Madras and a Tribunal case, to support the admissibility of such credit. However, the judge noted that a show-cause notice was timely issued, and the decision of the Larger Bench in the case of Vandana Global Pvt. Ltd. might be relevant. Despite this, the judge observed that while not all credit may be allowed, a portion could be deemed admissible due to the varied usage of the materials, including for connecting pipelines and evaporators. Consequently, the judge directed the appellant to deposit 50% of the denied CENVAT credit within six weeks, with a compliance report due on a specified date. Upon meeting this requirement, the judge granted a waiver of pre-deposit for the remaining dues and a stay against recovery during the appeal's pendency.This judgment showcases a nuanced approach to determining the eligibility of CENVAT credit, considering the specific usage of materials in supporting structures and equipment connections. By referencing relevant legal precedents and balancing the appellant's case with the specifics of the situation, the judge arrived at a decision that required a partial deposit of the denied credit while providing relief in the form of a waiver and stay against recovery. The judgment underscores the importance of a case-by-case analysis in matters of tax credits and the significance of compliance with directives issued by the tribunal.