Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

Comments

Print   |    |  Comment

PJ/Case Laws/2011-12/1400

Cenvat Credit on MS Angles, Channels etc

Case: THE COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE VISAKHAPATNAM-II Vs M/s APP MILLS LTD
 
Citation: 2011-TIOL-1378-CESTAT- BANG
 
Issue:- MS angles, plates and rounds used for fabricating structural support to plant and machinery – whether could be held to be 'capital goods' as defined under Rule 2(a) of CCR, 2004 for purposes of Cenvat credit?
 
Brief Facts:- Respondent used MS angles, plates and rounds for fabricating structural support to plant and machinery in their factory during the period from October 2006 to April 2007. They took credit on the same by contending that the said items could be held to be 'capital goods' as defined under Rule 2(a) of the Cenvat Credit Rules (CCR), 2004.
 
The Original Authority denied the benefit to the respondent and ordered recovery of Cenvat credit under Rule 14 of CCR, 2004 read with Section 11 A of the Central Excise Act, 1944. It also imposed penalty under Rule 15 of CCR. In appeal, the Commissioner (Appeals) granted the benefit to the respondent. Hence, Revenue filed appeal before the Tribunal.
 
Appellant’s Contention:- Revenue submitted that MS angles, plates and rounds were excluded from the ambit of the definition of 'input' by virtue of an Explanation to Rule 2(k) and further that the said items were held to be outside the purview of the definition of 'capital goods' by the Tribunal's Larger Bench in the case of Vandana Global Ltd. Vs. CCE, Raipur [2010 (253) ELT 440 (Tri. -LB)].
 
Respondent’s Contention:- Respondent relied on the Supreme Court's judgment in CCE, Jaipur Vs. Rajasthan Spinning & Weaving Mills Ltd. [2010 (255) ELT 481 (SC)] and also on the Madras High Court's judgment in CCE, Tiruchirapalli Vs. M/s. India Cements Ltd. [2011-TIOL-558-HC-MAD-CX].
 
Respondent contended that the view taken by the Supreme Court on the facts of the case of Rajasthan Spinning & Weaving Mills Ltd is squarely applicable to the facts of the present case. In the instant case, MS angles, plates and rounds were used to fabricate structural supports to plant and machinery whereas, in the case considered by the Supreme Court, similar items were used to fabricate a chimney for a diesel generating (DG) set. The chimney was held to be an integral part of the DG set and items used for its fabrication were held to be accessories of the DG set. Similarly the structural support fabricated by the respondent should be treated as an integral part of plant and machinery and therefore the MS angles, plates and rounds used for fabrication of the structural support should be held to be accessories.
 
Reasoning of Judgement:- The Tribunal held that ratio of Rajasthan Spinning & Weaving Mills Ltd was squarely applicable in case of respondent. The Tribunal noted that in the case of Rajasthan Spinning & Weaving Mills Ltd, the Supreme Court considered the question whether the steel plates and channels used in the fabrication of chimney for DG set would fall within the Sl. No. 5 of the table annexed to Rule 57Q as this Rule stood on or after 01.03.1997. The Tribunal compared the provisions of Rule 57Q with the provisions of Rule 2 (a) of CCR, 2004 and held that clause (i) of Rule 2 (a) (A) is pari material with clause (3) of the table annexed to Rule 57Q. Similarly, clause (iii) of Rule 2 (a) (A) is pari materia with clause (5) of the table annexed to Rule 57Q.
 
The Tribunal noted that the Supreme Court found that the DG set fall under Heading No. 85.02, Chapter 85 of First Schedule to the Central Excise Tariff Act and ipso facto got covered under Sl. No. 3 of the table annexed to Rule 57Q. The Supreme Court further noted that the chimney attached to the DG set was undisputedly covered by Sl. No.5 of the table annexed to Rule 57Q. On this basis, it was held that the chimney was an integral part of the DG set and, therefore, MS channels, plates, etc., used in its fabrication were to be treated as accessories in terms of Sl. No.5 of the table annexed to Rule 57Q.
 
The Tribunal held that facts of the present case were perfectly analogous to those of Rajasthan Spinning· & Weaving Mills Ltd. It was held that MS Angles, plates and rounds used by respondent for fabricating structural support for machinery qualify to be capital goods for cenvat credit. Order of the Commissioner (Appeal) sustained.
 
The Tribunal further held that the view taken by the Larger Bench of the Tribunal in the case of Vandana Global Ltd was taken much before the Supreme Court decided the case of Rajasthan Spinning & weaving Mills Ltd. Therefore, the view of the Larger Bench is no longer valid as it runs contrary to the later judgment of the Supreme Court.   
 
Decision:- Appeal dismissed.

Comments

Post a Comment



Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com