TaxTMI 
TaxTMI 
TaxTMI 
2017 (11) TMI 1329
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....e manufacture of cement & clinker falling under Chapter 25 of the first Schedule to the Central Excise Tariff Act, 1985. It was noticed that the assessee had availed cenvat credit during February, 2013 to March, 2013 amounting to Rs. 2,26,40,282/- on steel items i.e. M.S. Plate, M.S. Angle, Beam, M.S. Channel, M.S. Sheet, M.S. Bar, M.S. Rod, M.S. Strip and Flat etc. falling under chapter 72 and 73 of the first schedule to the Central Excise Tariff Act, 1985. They had also availed cenvat credit during April 2013 to September, 2013 amounting to Rs. 2,24,12,100/- on steel items i.e. M.S. Plate, M.S. Chequred Plate, TMT Bar, Triscal Plate, Square Bar, M.S. Channel etc. falling under Chapter 72 of the first Schedule to the Central Excise Tariff ....
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.... 37 of the Central Excise Act, 1944 shall not be applicable for allowing credit in respect of inputs used in an item on which provisions of Transfer of Properties Act apply. Therefore, it appeared that the aforesaid items could not be termed as inputs for the purpose of availing cenvat credit under the provisions of Cenvat Credit Rules, 2004 and credit of duty taken in respect of such items is not admissible to them. Accordingly, following two show cause notices were issued: (1) SCN dt. 24.2.2014 for recover of Cenvat credit amounting to Rs. 2,26,40,282/- alongwith interest and penalty under Rule 15 of the CCR, 2004. (2) SCN dt. 5.5.2014 for recovery of Cenvat credit amounting to Rs. 2,24,12,100/- alongwith interest and penalty under Ru....
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....ect of SCN dt. 24.02.2014 and steel items weighing 34.140 MT involving cenvat credit of amounting to Rs. 147827/- in respect of SCN dt. 05.05.2014 were issued by the civil department of the assessee for construction of clinker storage tank and raw water tank which is a civil construction work. Therefore, these constructed tanks are not covered under the definition of "input", hence not eligible for cenvat credit. v) Reliance was also placed on the Boards Circular No. 943/4/2011-CX dt. 29.4.2011 issued after the changes made in the definition of "input". It was concluded that impugned steel items are not hit by exclusion clause (F) as mentioned in the definition of input in Rule 2(k) of the Cenvat Credit Rules, 2004. vi) On examination of ....
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.... The appeal is against the dropping of demand amounting to Rs. 1,73,82,513/- and Rs. 2,22,64,273/-. Such cenvat credit allowed on items such as M.S. Plates, Angles, Beam etc. is improper since such goods cannot be considered to have been used in the manufacture of the final product i.e. cement. He further submitted that these goods were used for upgradation and maintenance of machines which are already fixed to the earth and cannot be considered as goods. 7. The ld. Counsel for the appellant -assessee summarised the assessee"s grounds of appeal as follows: The inputs such as M.S. Plates have been used in the manufacture of capital goods or repair and maintenance thereof. In the following case laws such credit stands allowed. Monnet Ispat....
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....t diesel oil, high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the final products cleared along with the final products, goods used as paint or as packing material, or as fuel, or for generation of electricity or stream used in or in relation to manufacture of final products or for any other purpose, within the factory of production;" The adjudicating authority has recorded that there is no dispute that all the impugned structural steel items have been used in the factory of the assessee Consequently, it i....
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....in the nature of capital goods. Since such capital goods cannot be suspended in mid air and for effective operation, the same needs to be kept on suitable support which became part of the storage tank i.e. capital goods. There is no doubt that such clinker storage tank is used in the manufacture of their final products. It has been consistently held by the Tribunal that such support structures are to be considered as part of the capital goods and goods used in the fabrication of such structures will be covered as inputs. Such view has been held: - Singhal Enterprises Pvt. Ltd. vs. CC&CE, Raipur vide final order No. 53013/2016 dated 12/08/2016 - Lafarge India Pvt. Ltd. vs. CCE, Raipur vide F. O. No. 53775/2016 13. Cenvat credit has al....