TMI Blog1990 (4) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... much as the inputs used in the manufacture of sand moulds are concerned these are to be taken to have been used in relation to the manufacture of sand moulds, which have to be considered as in the nature of equipment or apparatus which are specifically excluded from the purview of the MODVAT credit in terms of Rule 57A. The findings of the lower authority in the impugned order are as under: If the result of manufacture, with the inputs, is machinery, equipment, appliance etc. then such inputs cannot be said to be used in the making of steel castings. Machinery, plant, equipment, appliances etc. are not covered by the word input used in Rule 57A of the Central Excise Rules. Appellants have stated that sand mould is not an equipment, bec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wever, he pleaded, notwithstanding this in terms of Rule 57D, under which when specified inputs are used for the manufacture of the intermediary products, which are exempt from duty, the benefit of MODVAT credit is available and the appellants plea for benefit will have to be allowed. He pleaded that RT.12 returns were filed and the credit on the inputs taken was shown in that and which was disallowed. 5. The learned Senior D.R. pleaded that the plea regarding Rule 57D has been taken by the appellants for the first time before the Tribunal. In any case, he pleaded, the sand moulds are a product which by itself stands precluded from the benefit of the input credit relief as provided under Rule 57A and, therefore, the products which go int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the inner surface of these machines and equipments by lining the entire surface and cementing them so as to provide heat resistance and corrosive resistance lining for these machines and equipments. In that sense they could be broadly called a constructional material for lining the machine to effectively perform, by withstanding the heat and chemical reaction. They are more in the nature of constructional material required for lining the machines and equipment, than in the nature of material fed into the furnace for chemical reaction or for improving the quality of steel making. When this point is clear, that they go as a constructional material for lining the machine or equipment, even if they bring about the change in the substance in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used for such chemical process and not for lining the machinery and equipments." 6. We observe that it is accepted position that goods in respect of which the credit is claimed are used in the manufacture of sand moulds, which do not suffer any duty. The sand moulds, it has been pleaded, after their use only once, are broken after the iron castings get formed and for that reason these should be treated as intermediate goods. The point to be considered is whether the sand moulds can be considered as intermediate goods and whether by themselves these are one of the excluded category in respect of which the input credit relief under Rule 57A is not available. It is observed the term intermediate goods has not been defined in the Rules and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of Andhra Pradesh Paper Mills v. Collector of C. Excise, Guntur, in Appeal Nos. E/267 268/89/MAS, we have held as under: It is thus seen that the Hon ble Supreme Court has held that so long as it can be shown that the materials used as inputs have a nexus with the process which is integrally connected with the ultimate production of goods till the same are fit for being put in the marketing stream and such process is so integrally connected with ultimate production of goods that it would be commercially inexpedient to produce the finished goods without that process, all such inputs would get the benefit of credit of duty. It is observed that the stress is on the processes which are integrally connected with the production of the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her. The inputs used in these processes for manufacture of the products which are in turn used in the manufacturing stream of the finished product can be taken to have been used in the manufacture or in relation to the manufacture of the finished product. Generation of steam which ultimately participates in the manufacturing processes is one such item. The other may be pre treatment of the raw material which go into the manufacturing stream or the materials which may be used for making the end product ready for marketing. The use of the materials has to be such that they carry by their participation, in the manufacturing stream the process of manufacture a step further." In that case we have also considered the question of use of inputs i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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