2017 (4) TMI 795

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....riod of April, 2004 to March, 2008. On scrutiny of ER-1 returns, it was noticed by the department that the credit availed on MS items is not eligible under the category of capital goods as these items do not fall within the definition of capital goods. A Show Cause Notice was issued proposing to recover credit to the tune of Rs. 21,63,879/- for the above period and also proposing to impose penalty. After due process of law, adjudicating authority confirmed the demand along with interest and imposed penalty. In appeal, the Commissioner (Appeals) upheld the same. Hence this appeal. 2. On behalf of the appellant, the Ld. Counsel Shri P. Dwarakanath submitted that the appellant had explained in the reply filed to the Show Cause Notice the purp....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....r the appellant, has drawn my attention to the covering letter filed along with ER1 Returns. In this letter, it is seen that appellant has submitted the details of credit availed on MS items, the invoices relating to the MS items and the details of capital goods along with ER-1 Returns. The ER-1 Returns is the basis for the Show Cause Notice. Therefore it is evident that appellant has disclosed all details regarding the credit availed on MS items while filing the ER-1 returns. In addition, they have furnished certificate by a Chartered Engineer reflecting the use of the MS items in the factory of appellant. In the said certificate, the use of MS items for fabrication of capital goods/platform/support structures is reported as under: A. RE....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....following machinery:- a. Gasifier b. MS Rolls c. High pressure water pumps with storage tanks d. Transformer yard e. Furnace oil tanks 5. Thus it is seen from the certificate that the MS items have been used for fabrication of capital goods their parts/components/accessories thereof and also support structures for erection of the capital goods. The only ground on which the department has sought to deny the credit is on the basis of the judgment in the case of Vandana Global Ltd.(supra) wherein it was held that the amendment dated 07.07.2009 which restricted the use of M.S items is applicable retrospectively. It is the contention of department that after fabrication of the support structures including platform when embedded to ea....