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of <h1>CESTAT Kolkata Remands Case for Eligibility of CENVAT Credit on Steel Items</h1> <h3>M/s SHYAM SEL AND POWER LTD Versus COMMISSIONER OF CENTRAL EXCISE</h3> M/s SHYAM SEL AND POWER LTD Versus COMMISSIONER OF CENTRAL EXCISE - TMI Issues: Application for waiver of predeposit of duty and penalty under Rule 15(1) of CENVAT Credit Rules, 2004. Eligibility of CENVAT Credit on inputs/raw materials used in fabrication of machineries.In this judgment by the Appellate Tribunal CESTAT KOLKATA, the Applicant sought waiver of predeposit of duty amounting to Rs.2.22 crore and an equal penalty imposed under Rule 15(1) of the CENVAT Credit Rules, 2004. The Applicant claimed to have availed CENVAT Credit on steel items like angles, channels, beams, etc., used in the fabrication of machineries classified as capital goods, ultimately utilized in the manufacturing process of Sponge Iron. The Applicant provided a Chartered Engineers Certificate detailing the usage of these steel items in the capital goods and structurals, and reversed CENVAT Credit for a portion of the steel items. However, the Revenue contended that the Certificate did not specify the headings of the machineries where the steel items were used, as required for classification under Rule 2(a) of the CENVAT Credit Rules, 2004.The Tribunal noted that the primary issue revolved around the eligibility of CENVAT Credit on the steel items claimed to be used in the manufacture of machineries falling under specific headings of Rule 2(a) of the CENVAT Credit Rules, 2004. While the Applicant had submitted a Chartered Engineers Certificate before the issuance of the Show Cause Notice, the Department failed to conduct a proper verification. The Tribunal acknowledged the partial deposit made by the Applicant and the offer to deposit a further amount. However, due to the lack of specific classification of the machineries in the Certificate, the Tribunal deemed it necessary to remand the matter to the Commissioner for a fresh examination of the evidence. The Applicant was directed to make an additional deposit of Rs.8.00 lakh and the Commissioner was instructed to decide the case afresh after conducting the necessary verification, ensuring a fair opportunity for the Applicant to present their case.In conclusion, the Tribunal allowed the appeal by remanding the case for further examination by the Commissioner to determine the actual usage of the steel items in the machineries and structurals, emphasizing the need for proper verification and classification to establish the eligibility for CENVAT Credit.
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