C.C.E. & S.T.-Rajkot Vs Sanghi Industries Ltd (CESTAT Ahmedabad)
Undisputedly, the guesthouse is used for operations of the factory. Nothing is available on record to show that guesthouse is used for any other purpose. In view of this fact, since guesthouse used for operations of factory which has direct nexus with factory which produces excisable goods therefore Cenvat credit is admissible to the appellant on the furnitures used in Guest House of the factory.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
These two appeals are filed one by the Revenue and another by the assessee against O-I-O No. 01/COMMR/2011 dtd. 06.01.2011 passed by Commissioner, Central Excise, Ahmedabad-III.
1.1 Briefly stated the facts of the case are that the appellant had availed total Cenvat credit of Rs. 1,92,67,294/- during the period June 2007 to December 2007 on various items viz. M.S Beams / M.S. Pipes/ Plates / Channels / Sheets / Flats/ Chain / Anodes / Tube / Conveyor Belts / Filter Bags / S.S. Structures / Tyres/ Rope / Welding Electrodes etc. Show Cause Notice was issued to the appellants for recovery of the said credit along with interest and penalty alleging that the impugned goods used for civil construction purpose or repairs do not fall under the definition of inputs nor do they fall under the category of Capital Goods as per the Rule 2 of the Cenvat Credit Rules, 2004. On adjudication, out of total demand, demand of Rs. 1,71,26,939/- was dropped and demand of Rs. 21,40,371/- was confirmed with interest and penalty. Aggrieved by the said impugned order, both Revenue and assessee are in appeal.
02. Shri R. Subramanyam, Learned Advocate on behalf of the assessee submits that said materials have been used for maintenance and repair of the plant and machinery and capital goods within the factory. As regard the use of impugned goods Joint Memorandum /Verification report, was drawn Jointly by the Assistant Commissioner of Central Excise, Gandhidham and the DGM (Excise) of the assessee, at the factory premises. Based on the said Joint Verification Report. Learned Commissioner had passed the impugned order and allowed the Cenvat Credit. The Department in their grounds of Appeal has not challenged the Joint Verification Report which is the basis of factual verification and the bona fide grounds on which the cenvat credit was allowed. He relied upon the said verification report and pray that the appeal filed by the department may kindly be rejected. He placed reliance on the following decisions:-
