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of <h1>Appellate Tribunal grants Cenvat Credit on plant and machinery components for manufacturing process</h1> <h3>M/s. Hindustan Zinc Ltd. Versus C.C. Jaipur</h3> The Appellate Tribunal CESTAT NEW DELHI allowed the appellant's appeal in 2017, granting Cenvat Credit on items used for fabrication of plant and ... CENVAT credit - MS angles, channels, Cable tray, MS tower, copper anode, hanger bar and aluminum plate of electrolysis, etc - Held that: - the Cenvat Credit was allowed on various items like MS plates, channels, angles, beams, joist, iron sheets, angle plates, etc. for fabrication / manufacturing of various capital goods by the Tribunal in the case of Hindustan Zinc [2016 (3) TMI 346 - CESTAT NEW DELHI] - the Cenvat Credit was also allowed on the electrolysis plates as per the ratio laid down in the case of Cominco Binani Zinc Ltd. Vs. CCE [1990 (1) TMI 184 - CEGAT, MADRAS] - On anodes, the MODVAT was also allowed in the case of CCE Vs. Travancore Cochin Chemicals Ltd. [1994 (9) TMI 206 - CEGAT, MADRAS]. Appeal allowed - decided in favor of appellant. Issues:- Disallowance of Cenvat Credit on items used for fabrication of plant and machinery- Dispute regarding Cenvat Credit on MS tower for electricity transmission- Disallowance of Cenvat Credit on various items like angles, channels, cable trays, etc.- Appeal against the original order dated 10.01.2014 covering the period from April 2008 to December 2011Issue 1: Disallowance of Cenvat Credit on items used for fabrication of plant and machineryThe appellant filed an appeal against the original order disallowing Cenvat Credit on items used for the fabrication of plant and machinery. The appellant was engaged in the manufacture of various products and availed the Cenvat Credit facility. The Department had not allowed the credit on items used for fabrication. The appellant engaged M/s. L&T for this purpose. The Tribunal referred to previous cases where Cenvat Credit was allowed on similar items and concluded that the appellant's claim should be allowed based on the precedents set by previous judgments. The Tribunal allowed the Cenvat Credit on MS angles, channels, cable tray, MS tower, copper anode, hanger bar, and aluminum plate of electrolysis, setting aside the impugned order and allowing the appeal.Issue 2: Dispute regarding Cenvat Credit on MS tower for electricity transmissionThe appellant claimed Cenvat Credit on the MS tower used for electricity transmission. The Department argued against allowing the credit, citing a case where Cenvat Credit was not allowed on a tower used for cellular services. However, the Tribunal distinguished the present case from the case cited by the Department. The Tribunal noted that the tower in question was essential for the transmission of electricity, without which the factory could not operate. The Tribunal allowed the Cenvat Credit on the transmission line, following the precedent set in a similar case involving a cement company. The Tribunal held that the tower's use for electricity transmission by a manufacturing unit distinguished it from cases where towers were used solely for services, thus justifying the allowance of the Cenvat Credit in this instance.Issue 3: Disallowance of Cenvat Credit on various items like angles, channels, cable trays, etc.The Department disallowed the Cenvat Credit on items like angles, channels, cable trays, etc., used for fabrication of plant and machinery. However, the Tribunal referred to previous cases where similar credits were allowed, such as in the case of Hindustan Zinc. The Tribunal also cited cases where credits were allowed on various items like MS plates, beams, joists, iron sheets, etc. The Tribunal followed the precedents set in these cases and allowed the Cenvat Credit on the disputed items, including MS angles, channels, cable tray, MS tower, copper anode, hanger bar, and aluminum plate of electrolysis. By following the ratios laid down in previous judgments, the Tribunal set aside the impugned order and allowed the appeal of the appellant.In conclusion, the judgment delivered by the Appellate Tribunal CESTAT NEW DELHI in 2017 addressed multiple issues related to the disallowance of Cenvat Credit on various items used for fabrication of plant and machinery, the dispute over Cenvat Credit on an MS tower for electricity transmission, and the disallowance of credit on items like angles, channels, cable trays, etc. The Tribunal carefully analyzed the arguments presented by both parties, considered relevant precedents, and ultimately allowed the appellant's appeal by granting the Cenvat Credit on the disputed items.
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