TaxTMI 
TaxTMI 
2018 (3) TMI 1547
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.... said appeal relates to consideration of Cement availment of Cenvat Credit of the Central Excise duty paid thereon. In this case, the appellant had used the said goods in the structural foundation to support the power plant, which itself, is embedded to earth. Considering the divergent views expressed by different benches of the Tribunal, in the case of M/s Prakash Industries Ltd. (Final Order No.56266/2017 dated 23.08.2017) and appellant's own case, for earlier period (Final Order No.A/50309/2017-CU(SM) dated 12.01.2017), the Id. Single Member has placed the file before the Hon'ble President to constitute a Larger Bench, for reference on the following issue:- "Whether on Cement and Steel items used for foundation for installation ....
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....and examined the case records. 4. Before deciding the issue involved in this case, we deem it appropriate to extract the definition of 'capital goods' and 'input', as contained in Rule 2(a)(A) and Rule 2(k) respectively, in the CCR, 2004, which are extracted herein below :- 2(a) "capital goods" means:- (A) the following goods, namely:- (i) all goods falling under Chapter 82, Chapter 84, Chapter 85, Chapter 90, heading No.6805 grinding wheels and the like, and parts thereof falling under heading 6804 of the First Schedule to the Excise Tariff Act; (ii) pollution control equipment; (iii) components, spares and accessories of the goods specified at (i) and (ii); (iv) ............................; (v) ...............
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....answer to the definition of capital goods. Further, components, spares and accessories of the goods of above Chapters also qualify for the purpose of definition of capital goods. On reading of the above definition, it reveals that no Chapter of the Central Excise Tariff Act, 1985 (CETA) has been prescribed for the components, spares and accessories for consideration as capital goods. Thus, it is evident that irrespective of the classification of components, spares and accessories, when those are fitted to the machines/machineries of the above eligible Chapters, the same should also be considered as capital goods for availment of Cenvat Credit of Central Excise duty paid thereon. 6. In this case, the appellant contended that the Power Plant....
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...., what will be ultimate effect on the goods manufactured by the assessee. It is no doubt a fact that the above machineries without its proper installation, will not be functional to the satisfaction level, in order to achieve the desired objective. Thus, applying the 'user test' the Hon'ble Supreme Court in the case of Rajasthan Spinning & Weaving Mills Ltd. - 2010 (255) ELT 48 (S.C.) held that even though steel plates and M.S. Channels are used in fabrication of Chimney, would fall within the ambit of 'capital goods'. The relevant paragraphs in the said judgment are extracted herein below: 12. Inter alia observing that capital goods can be machines, machinery, plant, equipment, apparatus, tools or appliances if any of ....
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....terms of Serial No.5 of the goods described in column (2) of the Table below Rule 57Q. 8. Applying the user test of 'capital goods' as enunciated by the Hon'ble Supreme Court in the case of Rajasthan Spinning & Weaving Mills (supra), the Hon'ble Madras High Court in the case of India Cements Ltd., reported in 2012 (285) ELT 341 (Mad.), 2014 (305) ELT 558 (Mad.), 2014 (310) ELT 636 (Mad.) and 2015 (321) ELT 209 (Mad.) has extended the Modvat benefit on Cement and steel items, considering the same as 'capital goods' under Rule 57Q of the erstwhile Central Excise Rules, 1994. Since, said rule is parimateria with the present Rule 2(a) of the CCR, 2004, the disputed goods, in the present case, should be considered as ....
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....on as input' for the purpose of cenvat benefit. Analyzing and interpreting scope of the definition of input and capital goods, the Hon'ble Madras High Court in the case of M/s. Thiru Arooran Sugars & Ors. (Civil Misc. Appeal Nos.3814/2011 and 2695 and 2696/2012 has held that steel and cement used for laying of foundation for erection of capital goods should be eligible for the cenvat benefit under the present set of rules. The relevant paragraph in the said order is extracted herein below :- "44. In the facts of this case, we have to conclude that MS structurals, which support the plant and machinery, which are, in turn, used in the manufacture of sugar and molasses are an integral part of such plant and machinery. The Assessee has....