Commissioner (Appeals), Central Excise, and GST-Rajkot Versus M/s Sanghi Industries Ltd.
Central Excise
2018 (5) TMI 1507 – CESTAT AHMEDABAD – TMI
CESTAT AHMEDABAD – AT
Dated:- 21-3-2018
Appeal No E/10444/2018 – A/10570/2018
Central Excise
Dr. D. M. Misra, Member (Judicial)
For Appellant (s) Shri K. J. Kinariwala AR
For Respondent (s): None
Per: Dr. D. M. Misra
None present for the Respondent. Heard the Cd. AR for the Revenue.
2. This is an appeal filed against the order-in-appeal No. KCH-EXCUS-000-APP-137-2017-18 dated 20.12.2017 passed by Commissioner (Appeals), Central Excise, and GST-Rajkot.
3. The short issue involved in the present appeal is: whether the appellant are entitled to avail Cenvat credit of the duty paid in respect of inputs such as MS Angles, MS Channels, MS plates and MS PIPES etc. used in repair and maintenance of plant and machinery in their factory.
4. Ld. AR for the Revenue reiterated grounds of appeal and submitted that credit is
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air and maintenance of plant and machinery are eligible for cenvat credit, stands decided in favour of the Appellant by Hon'ble Rajasthan High Court in the case of Hindustan Zinc Ltd. (supra) wherein Hon'ble High Court has held that MS/SS plates used in the workshop meant for repair and maintenance of the plant and machinery's would be liable for cenvat credit and also by the judgments of Hon'ble Chhattisgarh High Court in the case of Ambuja Cements Eastern Ltd. v. Commissioner of Central Excise (supra) and Hon'ble Karnataka High Court in the case of Commissioner of Central Excise v. Alfred Herbert (India) Ltd. (supra) wherein Hon'ble High Court have held that the inputs used for repair and maintenance of plant and machinery would be eligible for cenvat credit. The learned departmental representative has cited a contrary judgment of Hon'ble High Court of Andhra Pradesh, in the case of Sree Rayalaseema Hi-Strength Hypo Ltd. v. Commissioner of Customs & Centra
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rectly or indirectly and whether contained the final products or not” is much wider than the scope of the expression “used in manufacture of” and therefore the expression- “used in or in relation to manufacture of final product', whether directly or indirectly” in the definition of input in Rule 2(2) would cover all the goods whose use is commercially expedient in manufacture of final products.
5.3 Repair and maintenance of plant and machinery is an activity without which smooth manufacturing is not possible. Commercially, manufacturing activity is not possible with malfunctioning machines, and leaking tanks, pipes and tubes. Therefore the activity of repair and maintenance of plant and machinery is an activity which has direct nexus with manufacture of final products and the goods used in this activity would be eligible for Cenvat credit. For eligibility of an input for Cenvat credit what is relevant is whether the activity in which that input is used has nexus with the manufact
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