CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL HYDERABAD REGIONAL BENCH - COURT NO. – I Excise Appeal No. 25441 of 2013 (Arising out of Order-in-Original No.16/2012-CE-HYD-III-ADJN (COMMNR) dated

28.09.2012 passed by Commissioner of Customs, Central Excise & Service Tax, Hyderabad -

III)

M/s Sheetal Shipping & Metal .. APPELLANT Processors Ltd., Survey No. 456, Sharajipet Village, Aler Mandal, Nalgonda, Telangana – 508 101.

VERSUS Commissioner of Central Tax, .. RESPONDENT Rangareddy - GST GST Bhavan, H.No. 1-98-7-43, Vip hills, Jaihind Enclave, Madhapur, Hyderabad, Telangana – 500 081.

APPEARANCE:

Shri B. Venu Gopal, Advocate for the Appellant.

Shri M. Anukathir Surya, Authorized Representative for the Respondent.

CORAM: HON’BLE Mr. A.K. JYOTISHI, MEMBER (TECHNICAL)

HON’BLE Mr. ANGAD PRASAD, MEMBER (JUDICIAL)

FINAL ORDER No. A/30167/2026 Date of Hearing: 01.12.2025 Date of Decision: 13.03.2026 [ORDER PER: ANGAD PRASAD]

M/s Sheetal Shipping & Metal Processors Ltd., (hereinafter referred to as appellant) filed this appeal against the Order-in-Original No.16/2012-CE- HYD-III-ADJN (COMMNR) dated 28.09.2012 which denied the Cenvat Credit and confirmed an amount of Rs. 58,49,116/- for the period May 2007 to June 2009. The appellant is a manufacturer of Sponge Iron and availed credit on steel items such as MS Channels, Ms Angles, TMT Bars, HRC Plates, MS Plates and electrodes.

2. The appellant during the period from May 2007 to June 2009, availed Cenvat Credit of duty paid on certain goods such as TOR Steel, MS Rounds, MS Beams, MS Angles, electrodes etc., (hereinafter referred to as MS Structurals) under the category of ‘capital goods’. The MS structurals were used by the appellant towards the erection of various capital goods such as hopper house, crushing house, screening house, stock house, chamber house, iron ore pre-heating Klin platform & house, PH Klin to Main Klin transfer chute & house, Main Klin platform, Klin to Cooler transfer chute &

house, shed for coal, central control maintenance room, etc.

3. Consequent to audit, the appellant was issued the Show Cause Notice dated 06.01.2012 invoking the extended period of limitation. The appellant submitted a detailed reply contesting the allegations in the SCN and also produced a Charted Engineer’s certificate to prove that the MS Structurals were used in the machineries erected at their plant where manufacturing activity is carried out.

4. Learned Commissioner passed the Order-in-Original holding the allegations in the SCN.

5. The appellant being aggrieved by the impugned order/O-I-O filed this appeal before the CESTAT.

6. Learned Counsel for the appellant submits that the Explanation 2 to Rule 2(k) of the Cenvat Credit Rules, 2004, was amended vide Notification No. 16/2009-CE(NT) dated 07.07.2009 and after amending, the explanation stood as follow:

“Explanation 2: Input include goods used in the manufacture of capital goods which are further used in the factory of the manufacture but shall not include cement, angles, channels, Centrally Twisted Deform bar (CTD) or Thermo Mechanically Treated Bar (TMT) and other items used for construction of factory shed, building or laying of foundation or making of structures for support of capital goods.”

7. However, after amendment, the Department took a view that the Notification is applicable with retrospective effect. The Larger Bench of CESTAT, New Delhi in the case of M/s Vandana Global Ltd., reported in [2010(253) ELT 440 (Tri-LB)], decided the issue in favour of the Revenue by holding that the amendment was clarificatory in nature and it was having retrospective application. On appeal by M/s Vandana Global Ltd., to the Hon’ble High Court of Chhattisgarh, the Larger Bench’s decision of the Tribunal was set aside and the matter was decided in favour of the assessee. The Court held that the amendment is applicable prospectively. Therefore, the findings of the Adjudicating Authority on the basis of the Larger Bench decision, supra is not sustainable.