CENVAT credit on steel used in fabrication of boiler and DM plant parts upheld; Vandana Global held inapplicable.

CENVAT credit on steel items used in fabrication of parts of a boiler and DM plant was held admissible because the items were used in manufacture-related fabrication, not as structural support for erection of plant and machinery. The facts were materially different from those considered in Vandana Global, and the dispute period preceded the retrospective amendment relied on in that ruling. As the amendment to the input definition could not be applied retrospectively, the Larger Bench decision was held inapplicable and the assessee's claim was upheld.

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Issues: Whether CENVAT credit on steel items used in fabrication of parts of a boiler and DM plant was admissible as capital goods, and whether the Larger Bench ruling in Vandana Global applied to deny such credit.

Analysis: The steel items were found to have been used in fabrication of parts of the boiler and DM plant, not for creating a structural support for erection of plant and machinery. The factual matrix was therefore materially different from the situation considered in Vandana Global. The period in dispute also preceded the retrospective amendment relied upon in that decision, and the subsequent judicial view recognised that the amendment to the definition of inputs could not be applied retrospectively. On that basis, the Larger Bench ruling was held inapplicable to the present facts.

Conclusion: The credit was held admissible and the assessee's claim was upheld.

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