CENVAT credit on steel inputs and services remanded after failure to consider factual use in fabrication and plant setup

CENVAT credit on MS/HR plates and input services was denied without properly examining the appellant's claims that the items were used in setting up a cement factory and fabricating machinery parts and capital assets. The reasoning relied largely on assumptions drawn from project imports and did not address the specific factual submissions or the actual use of the steel items. Because of this non-consideration of relevant material and inadequate appreciation of the record, the order was set aside and the matter remanded to the original adjudicating authority for fresh consideration after giving the appellant a reasonable opportunity.

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Issues: Whether the impugned order denying CENVAT credit on MS/HR plates and input services was unsustainable for failure to consider the appellant's material submissions and the factual context, warranting remand for fresh adjudication.

Analysis: The order recorded that the adjudicating authority had not examined the appellant's contentions regarding the setting up of a cement factory, the nature of the plant and machinery, the fabrication process, and the actual use of the steel items in relation to capital goods. The reasoning in the impugned order was found to rest substantially on an assumption drawn from project imports, without dealing with the specific factual plea that the items were used for fabrication of machinery parts and capital assets. In these circumstances, the order was held to suffer from non-consideration of relevant submissions and inadequate appreciation of the issues.

Conclusion: The impugned order was set aside and the matter was remanded to the original adjudicating authority for fresh consideration after granting reasonable opportunity to the appellant.

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