Input cenvat credit

[yateen vyas]

Sir,

We have used channel,angles bars for installation of pre- fabricated structure for storage of our finial finished gods.

Now it may be part of my Input for taking cenvat credit or it can part f exclusion clause of Input.

[YAGAY andSUN]

Dear Yateen,

In the decision of the Larger Bench of the CESTAT inVandana Global Ltd v CCE, Raipur2010 (4) TMI 133 - CESTAT, NEW DELHI (LB), the Larger Bench held that Goods like cement and steel items used for laying 'foundation' and for building 'supporting structures' cannot be treated either as inputs for capital goods or as inputs in relation to the final products and therefore, no credit of duty paid on the same can be allowed under the CENVAT Credit Rules. This order was delivered on 30th April 2010.

But the Supreme Court in CCE, Jaipur Vs. Rajasthan Spinning and Weaving Mills Ltd. - 2010 (7) TMI 12 - SUPREME COURT OF INDIA held that MS channels, plates, etc., used in its fabrication, were capital goods. This judgment was delivered on 9th July 2010 – that is after the Larger Bench decision.

Therefore, in this matter Tribunal Bench has held that, in view of the Supreme Court judgment, the view of the Larger Bench is no longer valid.

In our opinion you are eligible for availment of CENVAT credit. Please also check the facts of your matter at your end.

YAGAY and SUN

(Management and Indirect Tax Consultants)

[Mahir S]

Yes, cenvat credit appears to be eligible in your case But as an Input Credit.

AI Summary

CENVAT credit eligibility for metal channels and structural sections follows higher-court precedent, subject to factual verification. Whether metal channels, angles and bars used in installing a prefabricated storage structure qualify for CENVAT credit as inputs rather than being excluded as foundation or supporting-structure items; a Supreme Court ruling treating such metal sections used in fabrication as capital goods supersedes an earlier Larger Bench view denying credit, so eligibility depends on the specific factual use and must be verified against the controlling precedent.