M/S. Mileen Engineers vs Commissioner Of Central Excise, ...

[Arising out of Order-in- Appeal No. YDB/15/M-III/2010 dtd. 13/1/2010 passed by the Commissioner of Central Excise (Appeals), Mumbai Zone-II]

For approval and signature:

Honble Mr Ramesh Nair, Member(Judicial)

=======================================================

1. Whether Press Reporters may be allowed to see : No 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 : seen of the Order?

4. Whether Order is to be circulated to the Departmental: Yes authorities? =======================================================

M/s. Mileen Engineers : Appellants

VS

Commissioner of Central Excise, Mumbai-III : Respondent

Appearance

Noen for the Appellants Shri. Ashutosh Nath, Asstt. Commissioner(A.R.) for the Respondent

CORAM:

Honble Mr. Ramesh Nair, Member (Judicial)

Date of hearing: 26/5/2015 Date of decision: 26/5/2015

ORDER NO.

Per : Ramesh Nair

This appeal is directed against Order-in- Appeal No. YDB/15/M-III/2010 dtd. 13/1/2010 passed by the Commissioner of Central Excise (Appeals), Mumbai Zone-II, wherein Ld. Commissioner(Appeals) upheld the order-in-original dated 29/12/2008 and rejected the appeal of the appellant.

2. The fact of the case is that the appellant has availed Cenvat Credit in respect of capital goods received and installed in the premises which is not incorporated in the registered premises of the appellant. The show cause notice issued and culminated in the order-in-original wherein the adjudicating authority dropped the demand of Cenvat credit on the ground that subsequently, premises where the capital goods installed has been indicated in the registered premises. However demand of interest for the period from the date of taking credit in the premises got incorporated was demanded and penalty of Rs. 2,000/- was also imposed. Aggrieved by the said order the appellant filed appeal before the Commissioner(Appeals) who has maintained order-in-original therefore appellant is before me.

3. When the matter was called for hearing none appeared on behalf of the appellant, nor any request for adjournment was found, therefore I proceed to decide the matter on merit.

4. Shri. Ashutosh Nath, Ld. Asstt. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order. He submits that credit on capital goods can be allowed only when the capital goods is received in the registered factory, whereas in present case, though the capital goods was received by the appellant, but not in the registered premises but in the adjacent premises which was not part of the registered premises. Hence lower authorities have correctly demanded interest for the period from taking credit till the request for incorporation of premises where capital goods was installed was incorporated under the registered premises. He placed reliance on the judgment in case of Mangal Electricals Industries Vs. Commissioner of C. Ex. Jaipur[2014(311) ELT 691 (Tri. Del.)].

5. I have carefully considered the submission made by Ld. A.R. and perused the record.

6. I find that though the appellant has taken credit at the time of receiving of capital goods but it is also fact that capital goods was installed in the adjacent premises and used in relation of manufacture of final product in the registered premises. Since capital goods was used in the manufacture of final product for which excise duty is paid, in my view, credit is admissible from the date of installation and use of capital goods. Incorporation of the said premises is merely procedure requirement. The main requirement of availing Cenvat Credit is that capital goods should be used in the manufacture of dutiable goods which is not under dispute. In view of this position, I am of the view that appellant was entitled for the Cenvat Credit from the date of receipt and installation of the capital goods even though the part of the factory of the appellant was incorporated subsequently. As regard reliance placed by the ld. A.R. in case of Mangal Electricals Industries, I find that in the said judgment facts are not identical as the capital goods was installed in another unit, the assessees plea was that the goods were removed to another unit for job work whereas in the present case they received capital goods and installed in the adjacent premises but it was indeed used for the goods manufactured by the appellant in his registered premises, therefore fact of Mangal Electricals Industries case is different from facts of the present case. In view of the above discussion, impugned order is modified and appeal of the appellant is allowed.

(Dictated in court)

Ramesh Nair Member (Judicial) sk

4