CENVAT credit on structural steel used to fabricate plant equipment remains admissible even when the equipment is fixed to earth.

CENVAT credit was held admissible on MS angles, plates, channels, joists and beams used to fabricate hot blast stoves and related structures, because duty-paid structural steel used as components in capital goods does not lose credit eligibility merely by being embedded to earth. The reasoning accepted that large industrial facilities fixed to a concrete base for operational efficiency and safety may still remain goods for credit purposes when they form part of the manufacturing plant. Earlier judicial authorities and the Board circular supported allowing credit, and the Revenue's challenge failed.

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Issues: Whether CENVAT credit on MS angles, plates, channels, joists and beams used in fabrication of hot blast stoves and allied structures was admissible even though the structures were embedded to earth and claimed to be immovable property.

Analysis: The credit dispute turned on whether the fabricated hot blast stove and related plant formed capital goods used in the manufacture of dutiable final products, or whether embedding them in the earth deprived the assessee of credit. The decision followed the view that large industrial facilities fixed to a concrete base for operational efficiency and safety do not cease to be goods merely because they are anchored to the earth. It was also accepted that duty-paid structural steel items used as components in fabrication and assembly of such facilities remain eligible for credit under the CENVAT scheme, and that the Board circular and earlier judicial authorities supported this approach.

Conclusion: CENVAT credit was held to be admissible and the Revenue's challenge failed.

Final Conclusion: The order allowing the assessee's credit claim was sustained and the Revenue's appeals were rejected.

Ratio Decidendi: Credit under the CENVAT Credit Rules cannot be denied merely because duty-paid structural inputs are used to fabricate capital goods that are subsequently fixed to the earth, where the fabricated facility remains a component of the manufacturing plant and is not treated as immovable property for credit purposes.

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