HINDUSTAN ZINC LTD. Vs. CCE

JUDGEMENT

(1.) This appeal has been taken up for de novo decision in pursuance of order dt. 22.9.08 of Hon'ble Rajasthan High Court in respect of Central Excise Appeal No. 1/06 filed by the Appellant. A SCN dt. 1.8.95 was issued to the Appellant for denying Modvat credit on a number of items. The Asstt. Commissioner vide order -in -original dt. 17.11.97 disallowed Modvat credit amounting to Rs. 12,64,751/ - out of which Modvat credit amounting to Rs. 1,58,954/ - was denied in respect of Load Cells, Spares for Pump and Liner Plates for Bins for discrepancy in respect of their description as given in respective invoice and as given in the declaration filed under Rule 57T and Cenvat credit amounting to Rs. 3,10,536/ - was denied in respect of Plates, Angles and Channels on the ground that the same are not capital goods. On appeal by the Appellant, the Commissioner (Appeals) vide order -in -appeal dt. 25.11.03 allowed Modvat credit in respect of all the items except the Modvat credit amounting to Rs. 3,10,536/ - in respect of Plates, Angles and Channels and Modvat credit amounting to Rs. 1,58,954/ - in respect of Load Cells. The Appellant filed an appeal before the Tribunal against this order of the Commissioner (Appeals) and the Tribunal vide Final order No. A/949/05 dt. 2.6.05 dismissed the appeal. Against this order of the Tribunal, the Appellant filed an appeal before Hon'ble Rajasthan High Court and Hon'ble High Court vide order dt. 22.9.08 remanded the matter to the Tribunal for de novo decision after considering the Appellant's contention that the Plates, Angles and Channels are used as spares of the machinery and eligible for Modvat credit. Accordingly, this appeal has been taken up for de novo consideration.

(2.) Heard both sides.

(3.) As regards the M.S. Plates, Angles, Pumps etc., the Appellant's plea is that the same are part of Sintering machine. On going through the order -in -original, I find that this has not been denied as the Asstt. Commissioner mentions that the plates, angles and channels and pipes are used as structural items for manufacture of hood and roof, which are spare parts of sintering machine. The Asstt. Commissioner also observed that in the instant case, the plates, angles and channels/beams are used as input rather than capital goods. If this is so, it is not understood as to how the Modvat credit can be denied in respect of these items. Moreover Hon'ble Punjab & Haryana High Court in case of CCE, Jalandhar v. Pioneer Agro Extracts Ltd. (supra), with regard to old Rule 57Q of Central Excise Rules, 1944, has held that channels, angles, joists, squares of iron as steel; which are used for installation of batch vessel, are essential parts, of plant and machinery and following the ratio of this judgment, in this case also it has to be held that the plates, angles and channels used for making hood and roof of Sintering machine are parts of plant and machinery and hence capital goods. In view of this, I hold that there is no ground for denial the credit of Rs. 310536/ - in respect of plates, angles and channels.