The Hon’ble Mumbai CESTAT in the case of CCE, Pune – II v. Dongarai Sangareshwar Ssk Ltd [2014-TIOL-1557-CESTAT-MUM] has held that supporting structures bought as a part of the plant [i.e. not erected in the factory of the assessee] is eligible for CENVAT Credit, relying on judgment of Mumbai CESTAT in the case of India Cements Ltd. [2013-TIOL-1649-CESTAT-MUM]. Facts of the Case: The respondents are the manufacturers of sugar and molasses. To set up their sugar plant, they entered into an agreement with the supplier to supply the plant & machinery and some structures to support their plant and machinery. As per the agreement, the required plant and machinery and supporting structure were supplied. The respondent took credit of all the material supplied by the supplier. Revenue is of the view that for supporting structure they are not entitled to take CENVAT credit. Accordingly, impugned show-cause notice was issued to deny the CENVAT credit on the input used to manufacture of these supporting structures. The Hon’ble Mumbai CESTAT held that : “It is not a case that the supporting structures in dispute were erected in the factory of the respondent. In the case of Saraswati Sugar Mills (supra), the issue before the Apex Court was whether the Joints channels, angles and MS beams used in the fabricating supporting structures for installation of equipments are entitled to CENVAT credit. Admittedly, these items were purchased by the assessee to erect the supporting structure at the factory of the assessee which were embedded to earth. Therefore, they became immovable property and CENVAT credit was denied. But the same is not with the case in hand. In this case, these supporting structures were purchased by the respondent as part of sugar plant………………. Therefore, following the decision in the case of M/s. India Cement Ltd. (supra), I hold that the respondent is entitled to take the credit as per impugned order”
Posted on: Fri, 22 Aug 2014 11:18:08 +0000
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