Definition of capital goods as provided under Rule 2(a) of CENVAT Credit Rules, 2004 includes ‘tubes and pipes’ within its ambit. Department generally interpret this term in very narrow sense so as to cover only tubes and pipes made of iron or steel.
Recently, when this issue came for consideration before Honorable Delhi CESTAT in case of Shorewala Global Industries (P.) Ltd. v. Commissioner of Central Excise, Jaipur-I (2014) 50taxmann.com 433 (New Delhi - CESTAT), Honorable CESTAT held that the terms 'pipes and tubes' covers all pipes and tubes whether of iron and steel or of PVC or HDPE. Therefore, disallowing the credit in respect of PVC/HDPE pipes which according to the appellant were used in effluent treatment plant is totally wrong.
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