CENVAT credit on steel items for support structures was admissible as components of capital goods under the user test.

Steel items used to fabricate support structures for machinery and capital goods were treated as components or parts under the user test, bringing them within the ambit of capital goods for CENVAT credit under Rule 2(a) of the Cenvat Credit Rules, 2004. The Tribunal also followed its earlier view in the assessee's own case on the same issue and found no reason to disturb the appellate order, so the Revenue's challenge failed and credit was admissible.

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Issues: Whether CENVAT credit was admissible on steel items used in fabrication of support structures for capital goods and, consequently, whether the Revenue's challenge to the Commissioner (Appeals)' order could succeed.

Analysis: The steel items were used to fabricate support structures for machinery and capital goods, and the reasoning applied the user test to treat such fabricated structures as components or parts of the relevant machines. The decision relied on the settled view that structural items used for support structures serving capital goods fall within the ambit of capital goods for credit purposes under Rule 2(a) of the Cenvat Credit Rules, 2004. The Tribunal also followed the earlier binding view in the assessee's own case on the same issue and found no reason to disturb the appellate order.

Conclusion: CENVAT credit on the impugned steel items was admissible and the Revenue's appeal failed.

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