Commissioner Of Central Excise vs M/S. Bhushan Steel Ltd

[Arising out of Order-In-Appeal No. GZB/EXCUS/000/APP/067/13-14 dated 29.4.2013 passed by Commissioner of Central Excise (Appeals) Ghaziabad]

For approval and signature:

Honble Mr Ashok Jindal, Member (Judicial)

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Commissioner of Central Excise Appellants

& ST, Ghaziabad

Vs.

M/s. Bhushan Steel Ltd. Respondent

Appearance:

Shri G R Singh, AR for the Appellants

Shri Rajesh Chibber, Advocate for the Respondent

CORAM:

Hon'ble Shri Ashok Jindal, Member (Judicial)

Date of Hearing /decision: 20.1.2015

FINAL ORDER NO. A/ 50138 /2015-Ex(SM)

Per Ashok Jindal :

The Revenue is in appeal against the impugned order wherein the inputs Cenvat credit on welding electrodes has been allowed by the learned Commissioner (Appeals) being capital goods during the period April, 2011 to February 2012.

2. As the welding electrodes are not capital goods nor inputs, therefore, they are not entitled to take Cenvat credit thereon relying on the decision of Honble Andhra Pradesh High Court in the case of Sree Rayalaseema Hi-Strength Hypo Ltd. vs. CCE, Tirupati reported in [2012 (278) ELT 167 (AP)].

3. Learned AR submits that in the case of Sree Rayalaseema Hi-Strength Hypo Ltd. (Supra), the Honble High Court held that Cenvat credit on welding electrodes which were used for repair and maintenance of plant and machinery, do not qualify as inputs. Therefore, Cenvat credit cannot be claimed thereon under Rule 2(k) of Cenvat credit Rules, 2004. In these circumstances, he prayed that impugned order to be set aside. Other case laws relied upon by learned AR are as under:

i) Llyod Metals & Engineers Ltd. vs. Union of India

[2010 (252) ELT 355 (Bom)];

ii) CCE&ST Bhubaneshwar II vs. MSP Steel Pvt. Ltd.

[2009 (248) ELT 845 (Tri-Kolkata)];

iii) SAIL vs. CCE, Ranchi [2008 (222) ELT 233 (Tri-Kolkatta)

iv) Steel Authority of India Ltd. vs. Commissioner [2008( 229) ELT A 127 (SC)].

4. On the other hand, learned Counsel for the respondent submits that this Tribunal has taken into consideration on the decision of Honble High Court of Andhra Pradesh in the case of Sree Rayalaseema Hi-Strength Hypo Ltd. and in the case of The Oudh Sugar Mills Ltd. vs. CCE, Lucknow [ 2014-TIOL-1474-CESTAT-DEL] and held that Cenvat credit on welding electrodes which has been used in repair and maintenance of plant and machinery is admissible. He further submits that the issue has been decided by the Honble High court of Rajasthan in the case of Hindustan Zinc reported as 2007 (214) ELT 510 (Raj)] which has been affirmed by Honble Apex Court reported in [2007 (214) ELT A 115 (SC)]. He further submits thht said issue came up before Karnataka High Court in the case of Alfred Herbert (India) Ltd. [ 2010 (257) ELT 29 (Kar)] wherein the Honble High Court after considering the decision of Apex Court in the case of Hindustan Zinc held that Cenvat credit is admissible. He also relied on the decision of Ambuja Cement Eastern Ltd. [2010-TIOL-309HC-Chhattisgarh-CX). Therefore, he prayed that impugned order is to be upheld.

5. Heard the parties. Considered the submissions.

6. Revenue is relying on the decision of Sree Rayalaseema Hi-Strength Hypo Ltd. (Supra) to deny the Cenvat credit . On perusal of the said order, I find that in the order of Honble High Court in the case of Hindustan Zinc reported in 2008 (228) ELT 517 (Raj)] which has not considered the decision of Apex Court in the case of Hindustan Zinc Ltd. reported in [2007 (214) ELT A 115(SC)]. Further, in the case of Alfred Herbert (India) Ltd. (supra), the Honble High Court of Karnataka has followed the decision of Honble Apex Court in the case of Hindustan Zinc Ltd.

7. As there is decision of Honble Apex Court, holding that Cenvat credit on items which were used in repair and maintenance of plant and machinery are entitled for Cenvat credit, therefore, I hold that respondents are entitled to take Cenvat credit on welding electrodes. The case law relied upon by the learned AR have not considered the decision of Honble Apex Court. Therefore, these case laws cannot be relied upon. In these circumstances, I do not find any merits in the appeal filed by the Revenue, therefore same is dismissed by upholding the impugned order.

(dictated and pronounced in the open court )

( Ashok Jindal ) Member(Judicial)

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