M/S. Shakumbari Sugar and Allied Vs. Cce, Meerut - Court Judgment

Excerpt:

.....the ambit of 'capital goods' or not under rule 57q read with explanation 1 appended/thereto, requires re-examination in the light of the larger bench decision of the tribunal in the case of cce, indore vs surya roshni ltd. reported in 2001 (42) rlt.817, wherein guidelines have been laid down in that regard. therefore, the impugned order of the commissioner (appeals) to the extent of disallowing modvat credit of rs. 48,14,702/- to the appellants, is set aside, while the rest of his order denying credit of rs. 4,99,229/- to the appellants having been taken on non-duty paid documents is affirmed. the matter is, therefore, sent back to the adjudicating authority for deciding the modvatability of the goods on which the modvat credit of the above said amount of rs. 48,14,702/-, had been claimed by the appellants, afresh in the light of the above referred larger bench decision, of the tribunal after hearing both the sides. the appeal of the appellants stands accordingly partly allowed by way of remand.

Judgment:

1. In this appeal, the issue relates to the availability of Modvat credit of Rs. 14,14,702/- on the goods in question as detailed in the impugned order itself, of the Commissioner (Appeals) dt. 13.10.97. The appellants took Modvat credit on those goods by projecting as capital goods but the Commissioner (Appeals) had affirmed the order-in-original of Asstt. Commissioner that these were not capital goods.

2. It has been submitted by both the sides that the question as to whether the disputed goods fall within the ambit of 'capital goods' or not under Rule 57Q read with Explanation 1 appended/thereto, requires re-examination in the light of the Larger Bench decision of the Tribunal in the case of CCE, Indore vs Surya Roshni Ltd. reported in 2001 (42) RLT.817, wherein guidelines have been laid down in that regard. Therefore, the impugned order of the Commissioner (Appeals) to the extent of disallowing Modvat credit of Rs. 48,14,702/- to the appellants, is set aside, while the rest of his order denying credit of Rs. 4,99,229/- to the appellants having been taken on non-duty paid documents is affirmed. The matter is, therefore, sent back to the adjudicating authority for deciding the Modvatability of the goods on which the Modvat credit of the above said amount of Rs. 48,14,702/-, had been claimed by the appellants, afresh in the light of the above referred Larger Bench decision, of the Tribunal after hearing both the sides. The appeal of the appellants stands accordingly partly allowed by way of remand.