Availing of cenvat credit on PARTS of Capital Goods

[G GOSWAMI]

Since long we are availing Cenvat credit on PARTS' of Capital goods without any objection.

But recently EA-2000 Audit has raised objection for availing credit on 'PARTS' of Capital goods falling other than Chapter 84,85,82 &90 since the word 'PARTS' is not covered in the defination of Capital Goods under Rule 2(a)(A) of CCR. More over Air Circulator/Pedastal Fan of Ch.84 essential  in our manufacturing unit to cool the machines and to maintain the ambient of the manufacturing area are also not being allowed since they are not attached/parts/component of the CapitAl Goods/Machines. Kindly enlighten with your valued opinion.

Regards,

G.GOSWAMI

AI Summary

Cenvat Credit Denied for Parts Not in Chapters 82-90; Essential Factory Items Also Disallowed Under Rule 2(a)(A). A query was raised regarding the availing of Cenvat credit on parts of capital goods not classified under Chapters 84, 85, 82, and 90. An EA-2000 Audit objected to this practice, as these parts are not defined as capital goods under Rule 2(a)(A) of the Cenvat Credit Rules. Additionally, items like air circulators and pedestal fans, essential for cooling and maintaining the manufacturing environment, were also disallowed as they are not considered parts or components of capital goods. A response indicated that items essential for factory operations, like maintaining humidity, should be eligible for Cenvat credit.