2017 (8) TMI 1115

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...., Hoisting Closing Motor and paint by treating the same as capital goods. Revenue being of the view that since the said items are used for further fabrication of 'Floating Crane', which fall under heading 89.05 and are not covered by the definition of capital goods, as defined under Rule 2 (a) of the Cenvat Credit Rules, 2004, initiated proceedings against them for denial of the credit. Show cause notice dated 22.03.2013 was issued, by invoking the larger period of limitation. The same culminated into an order passed by the original adjudicating authority, confirming the demand along with interest and imposing penalties. 3. On an appeal, the Commissioner (Appeals) observed that in as much as all the items fall under Chapter 84 & ....

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....It is not the department's contention that the goods received under these invoices are not the goods falling under Chapter 84 or 85. The department's objection is that these items were used in the factory for fabrication and erection of paint shop, which being fixed to the earth structure, is not excisable and hence these items are not eligible for Cenvat credit. In my view, this objection by the department is absurd, as for permitting capital goods Cenvat credit, what has to be seen is as to whether the goods fall in the Chapters specified in the definition of capital goods or are the items specifically mentioned in the definition of capital goods and secondly whether those goods were used in the factory. The purpose for which the ....