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2015 (5) TMI 593 - HC - Central ExciseDenial of MODVAT Credit - Welding electrodes - Held that:- Welding Electrodes" as such have nothing to do with manufacture of 'sugar' and 'molasses' and other products, but, same is used for the purpose of repair and maintenance of machines, worn out during the process of running of factory. If no repair or maintenance is required for certain period, "Welding Electrodes" shall never be used. Thus, for the purpose of manufacture of 'sugar' and 'molasses' and other by-products in which business the appellant is engaged, the requirement of "Welding Electrodes" is not at all necessarily an integral part. It is only when repair or maintenance of machines is needed that requirement of "Welding Electrodes" may be necessary. - it can be safely said that under Rules 57A and 57B, there is no term within which 'Welding Electrodes', as such, may fall. Our attention was drawn to Rule 57B(1)(iv), where MODVAT credit has been allowed to 'inputs' used for manufacture of final products or for any other purpose within the factory of production. Similarly, our attention was also drawn to Rule 57B(1)(vi) which allowed MODVAT credit on accessories on final products cleared alongwith such final products, value of which is included in the assessable value of final products. Learned counsel for appellant could not explain as to how 'Welding Electrodes' can be said to be used for manufacture of final products or accessories of final products, so as to bring within provisions. 'Capital goods' and 'inputs' as defined in Rule 2 of Rules, 2001, includes the same items, to which Rule 57A, 57B and 57Q were applicable. No substantial distinction, we have found so as to find that during the period when Rules, 2001 are applicable, "Welding Electrodes" stand included within the definition of 'capital goods' or 'inputs' as the case may be, so as to entitle for MODVAT credit - Decision in the case of M/s Upper Ganges Sugar & Industries Ltd. Vs. Commissioner Customs & Central Excise [2015 (5) TMI 569 - ALLAHABAD HIGH COURT] followed - Decided against assessee.
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