2026 (3) TMI 349

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... including Chapters 72, 73, 84, 86, 27, 28 and 29. DSP is duly registered under the provisions of the Central Excise Act, 1944 to carrying out manufacturing activity in the said steel plant. 2.2 DSP is an integrated steel plant. There are various types of plant and machinery used in the plant for manufacture of dutiable iron and steel products and byproducts thereof. Inside the plant, there is a Maintenance Shop known as the Central Engineering Maintenance Shop, where various types of stores and spares required for maintenance of plant and machinery installed in the steel plant are manufactured. In carrying out such manufacturing activity, the CEM uses various types of plates, angles, channels, bars, sheets and rounds for manufacture of spares and parts required for the plant and machinery installed and used for manufacture of final products. 2.3 The manner of use of the said goods was detailed by DSP in proceedings under a Show Cause Notice dated 26th February, 1999, issued by the Commissioner of Central Excise, Bolpur, by a letter dated July 15, 1999. 2.4 The appellant availed cenvat credit of the duty paid on the said goods as input materials used in or in relation to t....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... on the finished goods. The Show Cause Notice therefore required the appellant to show cause as to why the allegedly wrongly availed cenvat credit of Rs.9,60,14,236/- (including Education Cess and Secondary & Higher Education Cess) in respect of the duty paid on the said goods during the period June 2006 to March 2011 should not be disallowed and, in view of the same having been utilised, should not be demanded and recovered from the appellant in terms of Rule 14 of the Cenvat Credit Rules read with the Proviso to Section 11A(1) of the Act, along with interest thereon in terms of Rule 14 of the Cenvat Credit Rules read with Section 11AB of the Act and as to why penalty should not be imposed upon the appellant in terms of Rule 15 of the Cenvat Credit Rules read with Section 11AC of the Act. 2.9 By a letter dated November 15, 2011 the appellant replied to the Show Cause Notice, drawing the attention of the Commissioner to the patently erroneous premises of both facts and law on which the Show Cause Notice was issued and requested that therefore the misconceived proceedings initiated by the Show Cause Notice under reference be dropped. The appellant also attended the personal heari....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....uivalent amount of penalty was imposed on the appellant. 2.16 Being aggrieved by the said order of the Commissioner, the appellant is before us. 3. The ld.Counsel for the appellant submits that in the year 1999, the appellant, under cover of a letter dated July 15, 1999, intimated the respondent that it manufactures various types of stores and spare parts in its factory for which it uses angles, channels, blooms, billets, rounds, etc. It was also intimated that such spares were used for maintenance and repair of plant and machinery installed in the factory and used for manufacture of dutiable products. It would be seen therefrom that detail description was given therein as to the related items of spares and parts and the respective machines/plants where they were being used. Further, before the Commissioner in the instant case, during the earlier proceedings, a writeup of the concerned department of the appellant was submitted by the appellant as a part of its reply to the show cause notice, which contained a detailed description of the user of the plates. Even in the denovo adjudication proceedings it would be seen that item wise details were provided regarding user of the s....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....dated February 25, 2016 and April 27, 2016. The said Certificate thus has to be read along with the contents of the said letters and not in isolation thereof. This is ex-facie evident from the Certificate itself. The Commissioner, however, in his closed and pre-determined mind to somehow or other confirm the earlier order, set aside by the Tribunal, ignored the said two letters and the contents thereof. The said purported action of the Commissioner is patently perverse and untenable. 3.3 Again, contrary to the patently incorrect assumption in the show cause notice that none of the angles, channels, plates and bars involved in the instant case have been used for manufacture of structural materials. They have all been used for manufacture of spares and parts of existing plants and machinery installed in the factory for manufacture of dutiable final products. No evidence to the contrary has been disclosed either in the show cause notice or in the said order. 3.4 Further, contrary to the erroneous findings of the Commissioner, the said goods were used in the manufacture of spares and parts of plant and machinery installed in the said factory which were capital goods within the me....