ISPAT INDUSTRIES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE issue pertains to eligibility of Modvat credit under Rule 57Q of erstwhile Central Eixcise Rules. The appellant availed of credit on angles, channels, plates, rods etc, as enumerated in the impugned order on the ground that they are required for installation and erection of machinery in his plant. It is the appellants' plea that such goods are covered under the explanation to Rule 57Q where capital goods have been defined.

(2.) HEARD both sides.

(3.) THE Ld. Advocate for the appellants relied upon the decision of the Tribunal in the case of United Phosphorous Ltd, v. Commissioner of Central Excise and Customs, Vadodam 2002 (150) E.L.T. 650 (Tri. -Mumbai) wherein the Tribunal held that 'plant' referred in erstwhile Rule 57Q would include not only the machinery used by a manufacture but also raw material and components employed therein. The Tribunal in the case cited supra relied upon the principles laid down in Jawahar Mills Ltd. v. Commissioner of Central Excise, Coimbatore and held that Modvat credit is extended to elements of factory shed etc. He also relied upon the decision of the Tribunal reported 2001 (137) E.L.T. 96, wherein it was Tribunal held that M.S. Plates, steel structural material, chequred plates are eligible for Modvat credit. In another case reported [2004 (175) E.L.T. 476] the Tribunal held rebar coils, CTD bars. TOR Steel, foist and Cement used for civil construction such as office premises alone are not eligible for credit. The same material when used for construction of concrete sylos, pre -heater tower structure, etc. which are essential for the manufacture of final goods, are eligible for credit. The Tribunal relied upon the Supreme Court's decision in Jawahar Mills wherein the Supreme Court interpreted the expression 'plant' and ruled that such material used in the plant are eligible for credit. A similar opinion was held in the case of Adarsh Industries v. Commissioner of Central Excise, Mumbai -VII. The Ld. Advocate also relied upon the Tribunal's decision in Mukand Ltd. v. C.C.E., where again it was held that structures which are supportive of conveyor system, become part of structural conveyor system and have been designed to function as part of conveyor system, giving support to it and helping in its efficient functioning are eligible for Modvat credit. He also relied upon the decision of the Tribunal in the case of Kasturi Sugar Mills wherein the Tribunal held that M.S. Structure having been used for installation of plant meant for manufacture of V.P. Sugar and not for fabrication and construction purposes are eligible for credit under Rule 57Q.