Appeal partially allowed for cenvat credit on steel materials in plant structure

The Tribunal allowed the appeal in part, ruling that cenvat credit for steel materials used in the structure of plant and machinery was admissible based on the High Court judgment. However, as there was no verification on the allocation of materials between support structures and factory sheds, cenvat credit for materials used in the factory shed was not allowed. The matter was remanded to the adjudicating authority for further verification and a fresh decision.

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Issues:
Whether the appellant is entitled to cenvat credit for steel materials like Angels, Channels, TMT Bars, etc.

Analysis:
The appellant, represented by Sh. W. Christian, argued that the denial of cenvat credit by the adjudicating authority was based on a principle established by a Larger Bench decision in the case of M/s Vandana Global Ltd. Vs. CCE. However, Sh. Christian pointed out that the Larger Bench decision was overturned by the Hon'ble Chhattisgarh High Court in the same case, stating that before 07.07.2009, all the relevant inputs were eligible for cenvat credit. He cited various judgments to support his argument. Additionally, he emphasized that the steel goods in question were used in constructing support structures for plant and machinery and factory sheds. He also contended that the demand was time-barred as the period in question was from March 2006 to April 2009, and the show cause notice was issued on 11.03.2011.

The Assistant Commissioner (AR), Sh. T.K. Sikdar, representing the Revenue, reiterated the findings of the impugned order. He argued that the judgment of the Hon'ble Chhattisgarh High Court only applied to steel materials used for supporting plant and machinery structures, not for factory sheds. He highlighted that this distinction had not been verified by the lower authorities.

After considering the submissions from both sides, the Tribunal found that cenvat credit for steel materials used in the structure of plant and machinery was admissible based on the Hon'ble Chhattisgarh High Court judgment in the case of M/s Vandana Steel Ltd. However, the Tribunal noted that the appellant had admitted that the steel materials were also used for erecting and fabricating the factory shed. Since there was no verification regarding the allocation of materials between support structures and factory sheds, the Tribunal ruled that cenvat credit for materials used in the factory shed was not admissible based on the High Court judgment. Consequently, the matter was remanded to the adjudicating authority for further verification and a fresh order. The appeal was allowed by way of remand for the adjudicating authority to re-examine the facts and make a new decision.

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