2022 (11) TMI 99

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.... 145.035 MT of Iron and Steel Materials like H.R. Plates, M.S. Plate, Flats, Beams, Channel, Chequered Coil, Angel etc. during April 2008 to March 2009 and claimed CENVAT Credit of Rs.5,51,616/-. The impugned Iron & Steel materials are used for manufacture of Base Frame & other ABC equipments, Base Frame for Kiln outlet & Transfer Chute, Kiln Maintenance Platform, Conveyor Gallery, Head & Tail Pully Frame, Conveyor Tustle& Gravity Take-up, Feeding & Discharge and Bag Fitter. 2.2 After EA2000 Audit, the Audit observation dated 01.02.2010 was issued. The Audit Team again visited the factory premises of the Appellant on 07.01.2011 for conducting physical verification for ascertaining the end use of the impugned goods as claimed by the Appella....

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....)upheld the adjudication order and rejected the Appeal before him. Hence the present Appeal before the Tribunal. 3. The Ld.Advocate, appearing on behalf of the Appellant, has submitted that the finding of the Ld. Commissioner (Appeals) disallowing CENVAT Credit is perverse. In the instant case, both the lower authorities haveseriously erred in holding Base Frames, Maintenance Platforms, etc as supporting structures whereas the Joint Verification report clearly states that the same as spares, components and accessories of Capital Goods which were structures only. 4. Ld.Authorized Representative for the Department justifies the impugned order and submits that the Appeal filed by the Appeal be dismissed being devoid of merits. 5. Heard both....

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....ls cannot be denied. 9. Further, Hon'ble Madras High Court in the case of Thiru Arooran Sugars and Ors Vs. CCE reported in 2017-TIOL-1357-HC-MAD-CX while impliedly overruling the decision of Larger Bench of this Tribunal in Vandana Global Ltd. held that even after 07.07.2009 explanation brought in by the said Notification dated 07.07.2009 CENVAT Credit on Iron and Steel materials, Cement etc used for making of support structures, construction of foundation etc cannot be denied as 'inputs' in terms of main limb of Rule 2(k) so long as items fulfill criteria of 'used in or in relation of manufacture of final products, whether directly or indirectly'. 10. The said amendment is made effective w.e.f. 07.07.2009 and therefore it cannot be retro....

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....to Larger Bench in the case of Vandana Global Ltd., Vs. CCE cited (supra). 13. I find that the Hon'ble Chhattisgarh High Court has set aside the decision of the Tribunal's Larger Bench in the case of Vandana Global as reported in 2018 (16) GSTL 462 (Chhattisgarh). I further observe that the principle of "user test" also need to be considered while deciding the entitlement of assessee to avail CENVAT Credit as laid down by the Hon'ble Supreme Court in the case of CCE Vs. Rajasthan Spinning & Weaving Mills Limited 2010 (255) ELT 481 (SC). Following the said decision, the Hon'ble Madras High Court in the case of Thiru Arooran Sugars, has held that iron and steel items and cement used for erection of foundation and support structures would als....

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....eeking to read them, that is, at cross purposes. In our opinion, the ratio of the two judgments, is that, as long as it is shown that the "component" and/or "accessory" is an integral part of the capital goods, (which, in turn, fall within the scope and ambit of the expression 'capital goods', referred to in Rule 2(a)(A)(i) of the 2004 Rules,) they would also qualify as capital goods. 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 clearly demonstrated that structurals as well as foundations, which are erected by using steel and cement are integr....