M/s. Fives Cail KCP Ltd. Versus Commissioner of GST & Central Excise Chennai North
Central Excise
2018 (12) TMI 923 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 11-12-2018
Appeal Nos. E/40790 to 40792/2018 – Final Order Nos. 43075-43077/2018
Central Excise
Ms. Sulekha Beevi C.S., Member (Judicial)
Shri Senthil Nathan, Consultant for the Appellant
Shri L. Nandakumar, AC (AR) for the Respondent
ORDER
Brief facts are that the appellants are manufacturers of machineries for sugar and cement industry. They export the impugned goods to Vietnam and other countries. The appellant availed CENVAT credit in respect of certain items which were not manufactured by them but were purchased and cleared along with the final product which was exported. The department was of the view that the appellants are not eligible for CENVAT credit on the bought out items. Show cause notices were issued for different periods proposing to disallow the irregularly availed credit of i
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ster concern, the very same issue has been analyzed and decided by the Tribunal wherein the credit was held to be eligible.
3. The ld. AR Shri L. Nandakumar supported the findings in the impugned order.
4. Heard both sides.
5. The issue is with regard to the eligibility of credit on certain items which are brought into the factory by the appellant and cleared along with the final product which was exported to Vietnam. The very same issue has been analyzed in the case of KCP Ltd. (supra) and the Tribunal has held that the credit to be eligible. The decision in the case of Thermax Ltd. Vs. Commissioner of Central Excise, Pune – 2016 (337) ELT 456 (Tri. Mum.) was relied by the Tribunal to decide the eligibility of credit. The relevant portion of the order is extracted below:-
“5.12 As per the undisputed facts of the case, the appellant had entered into a contract with the buyers located in Vietnam to supply and erect complete sugar plant. In para 6 of our Final Order No. 41661 to 4166
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for receipt and export, as such”.
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6.2 Ld. counsel has also drawn our attention to Board's clarification No. 607/44/2001-CX dated 13.12.2001, clarifying the scope of the said Rule 16. Ld. counsel has also pointed out that the said Rules was further amended vide Central Excise Rules, 2002, which made the scope of Rule 16 even wider.
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8.3 The ratio laid down by the Hon'ble Supreme Court in their subsequent judgment in Thermax Babcock & Wilcox Ltd. (supra), has been followed by the Tribunal in Thermax Ltd. Vs. Commissioner of Central Excise, Pune – 2016 (337) E|LT 456 (Tri. Mum.) wherein it has been held that bought out items used in erection of boilers at customer's site are inputs and cannot be distinguished from inputs used in manufacture of components within the factory, as both have gone into manufacture of final product.”
6. Following the said decision in KCP Ltd. (supra), I am of the view that the disall
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