2017 (5) TMI 456

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....air of the Bay by replacing the old worn out rail by a new rail and therefore, it would not come within the definition of input and capital goods under the CENVAT Credit Rules, 2005. 2. Heard the ld.A.R. for the Revenue and perused the appeal records. 3. The use of rails in their plant as mentioned in the impugned order is reproduced below : "That Blast Furnace is the main equipment in the appellant's plant. For ease of operation the base of the Blast Furnace is a pit wherein the raw material feeding systems such as "Scale Car" and "Skip Car" are installed, Raw material bins are fed with the raw materials through conveyor system. The "Scale Car" is basically a small container running on rails used for weighing the raw materials so a....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....s to maintain continuity of operation of the Furnace/Pig Casting Machine. This how the impugned "Rail" as claimed by the appellant is used in the manufacture of component of the accessory of the Furnace/Pig Casting Machine and thereby covered under the definition of "inputs" in terms of Explanation-2 to Rule 2 (k) of the CENVAT Rules. In other words, the appellant tried to claim that the furnace/pig casting machine etc. are capital goods in terms of Rule 2 (a)(A) (i) of CCR. The Bays are of the nature of accessories of these machines since on these "bays" the Skip Cars/Scale Cars move and therefore are to be treated as Capital goods as per Rule 2 (a)(A) (iii). The "Rails"/Bays get worn out on use and, they procure Rails to replace/repair th....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....connected to the process of manufacture of final products, even though the judgment relates to Rule 57Q of erstwhile Central Excise Rules, 1944, the principle laid down therein applicable even to the present cases under Cenvat Credit Rules, 2002/2004. In support, he refers to the judgment of Hon'ble Supreme Court in Vikram Cement's case (supra) wherein their Lordships have held that there is no difference in the Modvat and Cenvat Scheme. Challenging the said contention, the learned Special Counsel for the Revenue has submitted that the shortcomings in the erstwhile Rule 57Q had been done away with after the introduction of new set of Rules governing admissibility of Cenvat credit on capital goods and inputs. The present definition of ca....