Modvat credit on coated abrasives used in the manufacture of flush doors - Minutes of 2nd South Zone Tariff Conference held at Bangalore on 24th & 25th May, 1990 - Central Excise - 42/90-CX.8

Modvat credit on coated abrasives used in the manufacture of flush doors - Minutes of 2nd South Zone Tariff Conference held at Bangalore on 24th 25th May, 1990 Circular No. 42/90-CX.8 Dated 11-7-1990 [From F. No. 264/13/90-CX.8] Government of India Central Board of Excise Customs New Delhi Subject : Minutes on 2nd South Zone Tariff Conference held at Bangalore on 24th 25th May 1990 - Tariff Point No. 6 regarding whether coated abrasives used in the manufacture of flush doors are eligible for purposes of Modvat credit. I am directed to invite your attention to the minutes on Tariff Point No. 6 of the second South Zone Tariff Conference held at Bangalore on 24th 25th May, 1990 regarding admissibility of Modvat credit on coated abrasives when used in the manufacture of flush doors. It was contented therein that the coated abrasives were used to smoothen the rough surface of the flush doors before the same could be marketed. Since coated abrasives fell under Chapter 68 (which excludes tools) they could not be considered as tools for purposes of denial of Modvat credit on the same. Attention in this regard is invited to Point No. 3 of the Modvat meeting held at Bangalore on 29-11-1989 (circulated vide Board's F.No. 263/56/89-CX.8, dated 22-3-1990) wherein it has been clarified that since coated abrasives are used for polishing/grinding hand tools, they work more as producer goods than as inputs. These goods have been specifically excluded under Rule 57A as appliances used for manufacture of goods and are thus not entitled to Modvat credit. Board has therefore decided that coated abrasives cannot be considered as inputs in the manufacture of flush doors too for purposes of Modvat credit thereon. All pending cases may be decided accordingly. Trade Field Formations may be informed suitably. Receipt of this letter may please be acknowledged.