2016 (10) TMI 675

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....ispute arose regarding appellant s eligibility to take cenvat credit on CTD bars, TMT bars, etc. Since it appears that these items were neither inputs nor capital goods, the proceedings were initiated against the appellant to deny the credit availed on these items during the period October, 2004 to August, 2009. The proceedings concluded by adjudication by the Original Authority, who denied the credit of Rs. 49,71,546/- and Rs. 2,58,620/-. Penalties equal to the said amount were also imposed on the appellants. On appeal, ld. Commissioner (Appeals) confirmed the original orders and rejected the appeals. 3. Ld. Counsel for the appellants submitted that M.S. Items like bars, angles, etc. ere used by the appellants in the manufacture of stru....

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....apital goods are not eligible for cenvat credit. It is seen that the eligibility of the CTD bars, M.S. Angles, etc. for cenvat credit in situation similar to the present one have been subject matter of decision by the Tribunal, High Courts and Supreme Court. The Tribunal in a recent decision in the case of Singhal Enterprises Ltd. 2016-TIOL-2451-CESTAT-Delhi examined similar set of facts and held that the credit is available. The Tribunal s findings are as below:- "13. Now we turn to the question, whether credit is admissible on various structural steel items, such as, MS Angles, Sections, Channels, TMT Bar etc., which have been used by the appellants in the fabrication of support structures on which various capital goods are place....

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....l plates and MS channels used in the fabrication of chimney for diesel generating set. The credit stands allowed in the light of Rule 57Q of the erstwhile Central Excise Rules, 1944. In the said judgment, the Apex Court has referred to the user test evolved by the Apex Court in the case of CCE, Coimbatore vs. Jawahar Mills Ltd. -2001 (132) ELT 3 (SC), which is required to be satisfied to find out whether or not particular goods could be said to be capital goods. When we apply the user test to the case in hand, we find that the structural steel items have been used for the fabrication of support structures for capital goods. The appellants have argued that the various capital goods, such as, kiln, material handling conveyor system, furnace e....

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....gibility on the supporting structures for general maintenance and roofing purpose. The facts in the said case are different. The decision of the Hon'ble Supreme Court in the case of Saraswati Sugar Mills has been examined by the Hon'ble Madras High Court in the case of India Cement Ltd. 2015 (321) ELT 209 (Madras) and in many other similar cases. The Hon'ble Madras High Court observed as below:- "11. As far as the reliance placed on the decision reported in 2011-TIOL-73-SC-CX = 2011 (270) E.L.T. 465 (S.C.) (Saraswati Sugar Mills v. Commissioner of Central Excise, Delhi - III) in Civil Appeal No. 5295 of 2003, dated 2-8-2011 by the learned Standing Counsel appearing for the Revenue is concerned, we find that this Court had earlier c....

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....d in the fabrication of chimney would fall within the ambit of capital goods . In the face of this decision in the assessee s own case there being no new circumstance or decision in favour of the Revenue, we do not find any good ground to take a different view herein too. 10. As far as the reliance placed by the Revenue on the decision reported in 2011 (270) E.L.T. 465 (S.C.) (Saraswati Sugar Mills v. Commissioner of C.Ex., Delhi-III) is concerned, we do not think that the said decision would be of any assistance to the Revenue, considering the factual finding by the Tribunal therein in the decided case that the machineries purchased by the assessee were machineries themselves. Thus, after referring to the decision reported in 2010....