2023 (3) TMI 169 - AT - Central Excise

Appellate Tribunal allows CENVAT Credit on capital goods, including MS Angles, Beams, Plates, Channels

The Appellate Tribunal CESTAT MUMBAI allowed both appeals in favor of the appellant, permitting them to avail CENVAT Credit on capital goods such as MS ... CENVAT Credit - capital goods - MS Angles, Beams, Plates, channels etc. - HELD THAT:- It is found from the show-cause notice dated 21.04.2014 that the wordings “M/s CEAT Ltd. are using such capital goods i.e. MS Angles, Beams, Plates, Channels” indicates that the said goods were treated as capital goods by Revenue while issuing show-cause notice. Hon’ble High Court of Gujarat in the case of MUNDRA PORTS AND SPECIAL ECONOMIC ZONE LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & CUSTOMS [2015 (5) TMI 663 - GUJARAT HIGH COURT] has held that judgment of Larger Bench of the Tribunal in the case of VANDANA GLOBAL LTD. VERSUS CCE [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] was not a good law. By following the observation of Hon’ble High Court of Gujarat in the case of Mundra Port, the appellant are allowed to avail CENVAT Credit in respect of the goods in the present proceedings - appeal allowed. Issues: Admissibility of CENVAT Credit on capital goods - Interpretation of Larger Bench decision in Vandana Global Ltd. caseIn this case, the Appellate Tribunal CESTAT MUMBAI considered two appeals together where the issue involved was the admissibility of CENVAT Credit on capital goods such as MS Angles, Beams, Plates, Channels, etc. The Revenue initially contended that the CENVAT Credit on these goods was not admissible to the appellant, leading to proceedings being initiated against them. The Order-in-Original initially dropped the demand, but for another period, the demand was confirmed. The Commissioner (Appeals) decided against the appellant, prompting an appeal to the Tribunal. The Tribunal, in a previous order, remanded the matter to the Commissioner (Appeals) due to the overruling of the Larger Bench decision in the case of Vandana Global Ltd. by the High Courts of Gujarat and Kolkata. The impugned order was the Commissioner (Appeals) decision after the remand.The appellant's counsel argued that despite the Tribunal's indication of the overruling of the Vandana Global Ltd. decision, the Commissioner (Appeals) once again rejected the CENVAT Credit on the mentioned items. On the other hand, the Authorized Representative contended that the goods in question were not capital goods, making the appellant ineligible for CENVAT Credit. The Tribunal carefully reviewed the case records and submissions from both sides. The show-cause notice indicated that the goods were treated as capital goods by the Revenue. Citing the High Court of Gujarat's decision in the Mundra Port case, which held the Vandana Global decision as not good law, the Tribunal allowed the appellant to avail CENVAT Credit for the mentioned goods in the ongoing proceedings.Ultimately, the Tribunal allowed both appeals in favor of the appellant, permitting them to avail CENVAT Credit on the disputed goods.