TMI Blog1991 (9) TMI 213X X X X Extracts X X X X X X X X Extracts X X X X ..... Objection (C.O. No. 44/91) filed by the respondents M/s. IDL Chemicals Limited. On a perusal of the appeal and the Cross Objection, we find that against a similar Order-in-Appeal dated 15-2-1991, the same appellant Collector has filed another appeal, which has been registered under Appeal No. E-98/91. That appeal has not been listed for hearing today. However, since the issue involved in the appeal posted for hearing today completely overlaps the issues canvassed and agitated therein, we have decided to take up all these matters for simultaneous hearing and disposal. 2. Shri M.N. Biswas, learned Senior Departmental Representative appeared for the appellant Collector. He referred to the arguments contained in the appeal and adopted the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor to revise his own earlier decision, the Order-in-Appeal should stand. He added that on merits also they have a very strong case. The Collector (Appeals) had visited the factory of the respondents and seen the process of manufacture of the slurry explosives and also their actual use. He had taken note of what he has observed in this regard and given his reasoned finding. The contention of the Department that the plastic tubes and lay flat tubings are only packaging materials, is not based on a correct appreciation of the factual position. These are not packaging materials any more than the tissue paper inside which the tobacco of a cigarette is wrapped or the gelatine capsule in which medicines are packed, are packaging materials. He al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and not to the raw materials thereof. We do not agree with this view. The scheme of Rule 57A is that credit of duty is available in respect of the duty paid on the goods used in or in relation to the manufacture of the final products. This is the cardinal principle underlying the admissibility of the modvat benefit. Only, for the sake of convenience and as an abbreviation, the expression input has been used in Rule 57A to refer to the goods used in or in relation to the manufacture of the final products. In the Explanation Clause, the scope of the expression input has been spelt out both by an inclusion clause and an exclusion clause. Actually, the exclusion clause does not use the word excluding but uses the antonym stating does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fic inclusion would take care of such a situation and bring within the scope of modvat credit packaging material also. But that does not mean, as stated earlier, that the benefit to goods which are used in or in relation to the manufacture of the final product in the present case are not available. It is an undeniable fact that the plastic granules are used in the manufacture of the blow moulded tubes and the lay flat tubing which are then used in the manufacture of the explosives. There is no doubt at all that the plastic granules can be said to be used in the manufacture of explosives notwithstanding the passage through the stage of the tubings. The fact that the lay flat tubing or blow moulded tubes happen to be exempted would not affect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterials with package or containers. The very expression packaging materials would signify that they are not same as package, but irrespective of this question, the issue is comprehensively in favour of the respondents. Likewise, there is no merit in the contention that the fact that in the blasting operations, these slurry explosives along with the packets/lay flat tubings get burnt up, does not alter the position that these tubes/lay flat tubings remain in the nature of containers/packing materials. These points have been adequately covered in the Order-in-Appeal passed by the Collector (Appeals), which we should say, is a very well reasoned one, taking note of the actual process of manufacture and the legal provisions relating to the ava ..... X X X X Extracts X X X X X X X X Extracts X X X X
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