Tribunal Overturns Disallowance of Cenvat Credit on Inputs & Capital Goods in Mines

The Tribunal held that the Order-in-Appeal disallowing Cenvat Credit on inputs and capital goods used in mines was legally unsustainable due to the overruling of a previous judgment. The appellant's reliance on the judgment in the case of M/s Vikram Cement was upheld, leading to the appeal being allowed and consequential relief granted.

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Issues:
- Availment of Cenvat Credit on inputs and capital goods used in mines
- Interpretation of conflicting judgments by the Hon'ble Supreme Court
- Validity of Order-in-Appeal disallowing Cenvat Credit

Analysis:
1. Availment of Cenvat Credit on inputs and capital goods used in mines:
The appellant, a manufacturer of Aluminium and its products with mines in Jharkhand and Madhya Pradesh, availed Cenvat Credit on duty paid for capital goods and inputs used in the mines. The Revenue alleged contravention of the Cenvat Credit Rules, 2004, and issued a show cause notice proposing to deny Cenvat Credit of Rs. 13,85,919. The Original Authority upheld the denial despite the appellant's reliance on the judgment in the case of M/s Vikram Cement. The Commissioner (Appeals) also disallowed the appeal, leading to the appellant approaching the Tribunal.

2. Interpretation of conflicting judgments by the Hon'ble Supreme Court:
The appellant argued that the judgment in the case of M/s Vikram Cement overruled the ruling in the case of J.K. Udaipur Udyog Ltd., which was relied upon by the Commissioner (Appeals). The Tribunal, after considering the rival contentions and examining the ruling in the case of Vikram Cement, concluded that the judgment in J.K. Udaipur Udyog Ltd. was overruled by the Hon'ble Supreme Court in the case of Vikram Cement. Therefore, the Tribunal held that the Order-in-Appeal disallowing the Cenvat Credit was bad in law and set it aside, along with the Order-in-Original dated 18.10.2010.

3. Validity of Order-in-Appeal disallowing Cenvat Credit:
The Tribunal, presided over by Mr. Anil G. Shakkarwar, Member (Technical), found that the impugned Order-in-Appeal was not legally sustainable due to the overruling of the judgment in the case of J.K. Udaipur Udyog Ltd. by the subsequent ruling in the case of Vikram Cement. Consequently, the Tribunal allowed the appeal of the appellant, entitling them to consequential relief as per law. The decision was dictated and pronounced in court, bringing the matter to a close.

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