2008 (6) TMI 400

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....f the Central Excise Tariff Act, 1985. The applicant received duty paid items like angles, joists, beam, channels, bars, flats, oxygen gas, welding electrodes, thermal insulation etc., and used them for fabrication of various structures relating to power plants, sponge iron plants, ferro alloy plant, steel division. (b)  They had availed credit of excise duty paid on such items treating them sometimes as inputs and sometimes as capital goods. (c)  Three show cause notices were issued covering different periods proposing to disallow and recover the Cenvat credit taken on above steel construction materials and oxygen gas and welding electrodes. (d)  The original authority by the impugned order dated 4-2-08 ordered reco....

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....puted items. 5.1 We have carefully considered the submissions from both the sides. The cenvat scheme, in the initial stages, envisaged allowing credit of duty paid only on the inputs; it was later extended to duty paid on capital goods, however the entire plant of the factory may not qualify to be considered as capital goods for the purpose of cenvat scheme as no duty is chargeable on the plant as goods. 5.2 In the present case, we, prima facie, find that the steel items like angles, joists, beams, channels, bars, flats, etc. are used in the construction work; the resultant structures are permanently embedded to the earth; they cannot be considered as part of the machinery/equipment; they do not qualify to be called as goods....

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....ater etc. Therefore, the disputed items are in the nature of components to the said plants as without the columns, beams, cellars, trenches, tunnels, roofing etc. the plant cannot exist and hence, are components of plant. Therefore, invoking Explanation 2 to Rule 2(g) of CCR, credit on cement and steel in any case is admissible. 6.3 In the light of the above, we hold that credit on the disputed cement and steel used for factory building including tunnels, trenches, cellars etc. is admissible. 7.1 The Commissioner denies credit on GPCC Core/ Trap Sheet, Blendster holding them to be roofing material installed overhead as well as the slides of the factory sheds/bays. He holds that the said item neither are components nor spares....