CENVAT credit on fabrication steel items turns on the user test and proof of actual use for capital goods support structures.

CENVAT credit on H.R.S. plates, H.R.S.S. plates, H.R. steel sheets, H.R. coils and similar materials used to fabricate support structures for capital goods was analysed by applying the user test and the settled principle that such items may qualify for credit where they form part of fabrication for eligible capital goods. The claim, however, depended on proof of actual use, including supporting evidence such as a Chartered Engineer's certificate, which was not on record. The matter was therefore remanded to the adjudicating authority for factual verification of the appellant's claim and fresh decision in accordance with the settled legal principle.

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Issues: Whether CENVAT credit was admissible on H.R.S. plates, H.R.S.S. plates, H.R. steel sheets, H.R. coils and similar items used for fabrication of support structures for capital goods, and whether the claim required factual verification by evidence.

Analysis: The items were claimed to have been used in fabrication of support structures on which capital goods were installed in the factory. The legal position on eligibility of credit on such structural items was treated as settled by applying the user test and the principle that items used in fabrication of support structures for capital goods may fall within capital goods for credit purposes. At the same time, the claim of actual use had to be supported by evidence, including a Chartered Engineer's certificate, which was not on record.

Conclusion: The credit issue was not finally decided on facts and the matter was remanded to the adjudicating authority for verification of the appellant's claim and decision in accordance with the settled legal principle.

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