Commissioner, Central Excise, Vs. M/S. Indian Acrylic Ltd.

Commissioner, Central Excise, vs M/S. Indian Acrylic Ltd.

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi Decided Mar 23, 2001

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Citation: sooperkanoon.com/21734
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Delhi
Decided On: Mar 23, 2001
Subject: Excise

Case Summary

AI-generated summary - not the official court judgment text.

Excise

Key legal issue: Excise

Parties & Advocates

Appellant / Petitioner

Commissioner, Central Excise,

Respondent

M/S. Indian Acrylic Ltd.

Excerpt

.....processing of any goods or bringing about of any change in respect of the final products. it is observed that the larger bench of the cegat in the case of commissioner of central excise, indore vs.surya roshin ltd., reported in 2001 (128) e.l.t. 293 (tri.lb) an consideration of the definition of the capital tools under rule 57q have held that the machine, machinery, plant, equipment, apparatus, tools or appliances whatever be the category to which the goods belongs would fall within the definition of capital goods, if, (ii) they are used for processing of any goods for the manufacture of final product or (iii) used for bringing about any change in any substance for the manufacture of final product. thus, any machine, machinery, plant equipment, apparatus, tools or appliances if satisfy any one more of the three conditions mentioned therein, such "capital goods" will be entitled to modvat credit. it is further observed that not only complete machinery but even their components, spare parts would be entitled to the modvat credit as capital goods provided they satisfy the same conditions. it is observed that in the present case none of the lower authorities are given their findings with regard to the provisions under rule 57q of the central excise rules. therefore, the order appealed against is set aside and the matter is remanded to the original against is set aside and the matter is remanded to the original authority for passing a de novo order. keeping the view held in the above cited decision of the larger bench of the cegat. the respondents shall be afforded reasonable opportunity of hearing before taking a final view in the matter.

Full Judgment

1. The respondents manufacture Acrylic Staple Fibre falling under Sub-heading 5501.30. They are availing the facility of MODVAT credit on capital goods under Rule 57Q of Central Excise Rules, 1944. The Assistant Commissioner of Central Excise, Jallandar Division Under a number of orders passed by him denied them the MODVAT credit totally amounting to Rs, 1,300,436/- availed by them on the items as capital goods under rule 57Q of the Central Excise Rules, 1944. He also imposed a penalty amounting to Rs. 2 lakhs on them.

2. The party filed appeals against the above orders and the Commissioner (Appeals), Chandigarh vide his common order dated 29.4.99 allowed the appeals of the party setting aside the orders passed by the original authority.

3. The Revenue are in appeal against the above order of Commissioner (Appeals). Heard Shri Swatantra Kumar, JDR for the Revenue and Shri K.K. Anad, Advocate for the respondents. It is contended in the Revenue appeals in respect of items subject matter of consideration that the same are no eligible for the availment of the MODVAT credit as capital goods under the definition provided under rule 57Q of the Central Excise Rules, 1944. It is also contended that these are not used for producing or processing of any goods or bringing about of any change in respect of the final products. It is observed that the Larger Bench of the CEGAT in the case of Commissioner of Central Excise, Indore Vs.

Surya Roshin Ltd., reported in 2001 (128) E.L.T. 293 (Tri.LB) an consideration of the definition of the capital tools under Rule 57Q have held that the machine, machinery, plant, equipment, apparatus, tools or appliances whatever be the category to which the goods belongs would fall within the definition of capital goods, if, (ii) they are used for processing of any goods for the manufacture of final product or (iii) used for bringing about any change in any substance for the manufacture of final product. Thus, any machine, machinery, plant equipment, apparatus, tools or appliances if satisfy any one more of the three conditions mentioned therein, such "capital goods" will be entitled to MODVAT credit. It is further observed that not only complete machinery but even their components, spare parts would be entitled to the MODVAT credit as capital goods provided they satisfy the same conditions. It is observed that in the present case none of the lower authorities are given their findings with regard to the provisions under Rule 57Q of the Central Excise Rules. Therefore, the order appealed against is set aside and the matter is remanded to the original against is set aside and the matter is remanded to the original authority for passing a de novo order. Keeping the view held in the above cited decision of the Larger Bench of the CEGAT. The respondents shall be afforded reasonable opportunity of hearing before taking a final view in the matter.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Delh... Same Parties Commissioner, Central Excise, vs M/S. Indian Acrylic Ltd. Same Subject Excise