M/s Ultratech Cement Ltd. Versus Commissioner of GST & Central Excise, Nagpur
Central Excise
2018 (2) TMI 6 – CESTAT MUMBAI – TMI
CESTAT MUMBAI – AT
Dated:- 21-12-2017
E/87335 & 87337/17 – A/92117-92118/2017
Central Excise
Shri Ramesh Nair, Member ( Judicial )
Shri Rajesh Ostwal, Advcoate for Appellant
Shri A.B. Kulgod, Asstt. Commissioner (AR) for Respondent
ORDER
Per : Ramesh Nair
The appellants have availed CENVAT Credit on Diesel Locomotive under capital goods as the same is used for conveyance of the raw materials and finished goods within the factory premises. The adjudicating authority denied the credit on the ground that the diesel locomotive is not covered under the definition of capital goods. The learned Commissioner (Appeals) upheld the disallowance ordered by the adjudicating authority. Therefore, the appellants are before me.
2. Shri Rajesh Ostwal, learned Counsel appearing on behalf of the appellant submits that they have availed the credit on
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raw material/finished goods in the factory of the appellant. As per chapter heading 86 of the Diesel Locomotive, it is not covered under the capital goods. But, there is no dispute that the said goods is used in or in relation to the manufacture of the final product. Therefore, it qualifies as an input and credit is admissible. The very same issue of admissibility of CENVAT Credit on diesel locomotive has been considered by this Tribunal in the case of Bhushan Steel (supra), wherein the Tribunal has passed the following order: –
“5.1 We have carefully considered the submissions and perused the record. The ld. Commissioner (Appeals) in the impugned order has found as under :-
“7. It is seen that the transportation of molten iron from blast furnace to conarc furnace and thereafter to the pig casting machine is an essential part of manufacturing process. Without carriage of such molten metal from one place to another, the manufacturing cannot take place. In doing so, the diesel engin
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ace to another. The torpedo ladle car containing molten iron could have been manually handled from one place to another. But its effectiveness in carrying the molten iron without melting can be enhanced by use of diesel locomotive. Thus the diesel locomotive is no doubt an accessory to the various machines used in the factory. In view of this, I hold that diesel locomotive is an accessory to goods falling under chapter 84, such as blast furnace, conarc furnace and pig casting machine and is thus capital goods. The appellant had correctly availed the Cenvat credit of the duty paid on diesel locomotive.
8. The appellant have also asserted that the use of diesel locomotive in carrying molten metal from blast furnace to conarc furnace and then to pig casting machine is part of the chain of manufacturing processes. There can be no doubt that this is so the case. So also bringing raw materials, like coal and iron ore, to the furnace and to carry empty wagon in the factory is also part of t
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enhanced by the use of Diesel Locomotive. However, he failed to appreciate that once it is a question of handling 300 to 350 molten metal, it is not easy to handle it manually, if not impossible in normal situations. We, thus, record the concern of the appellant, in this regard. Further if we look at this issue beyond the general perception that the locomotive engines are used usually for pulling the passenger/goods trains, we find that Diesel Locomotive torpedo ladle car carrying molten metal up to 300-350 MT not only enhances the effectiveness, but without it the handling, and in turn production of finished goods would not be possible. Thus we uphold the view of ld. Commr. (A) holding diesel locomotive as accessory of capital goods. In these circumstances we do not find any merit in the appeal filed by department. Thus the impugned order is upheld and appeal is dismissed, as above.”
4.1 On the identical issue in the appellant's own case in respect of mono block for railway track
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issible on MBC sleepers.
7. The appellant has also argued on the issue of limitation. They had disclosed the availment of credit in the ER-1 returns. The show cause notice is issued basing on the judgment laid in Vandana Global Ltd. (supra). There is no case for revenue that the appellant has not disclosed the credit details in their accounts or in ER-1 returns. They believed that credit is admissible and maintained proper statutory records reflecting the details of credit. On such score, it cannot be alleged that the appellant has wilfully suppressed facts with intent to evade payment of duty. The Hon'ble Apex Court in Uniworth Textiles Ltd. v. CCE, Raipur – 2013 STPL (web) 69 SC = 2013 (288) E.L.T. 161 (S.C.), relying on the judgment in Pushpam Pharmaceuticals Co. v. CCE, Bombay [1995 Suppl (3) SCC 462 = 1995 (78) E.L.T. 401 (S.C.)] has held that Suppression of facts can have only one meaning. That the correct information was not disclosed deliberately to evade payment of duty. On
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