TMI Blog1992 (11) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... By the said order, the Assistant Collector had granted them the benefit of modvat credit in respect of Silicon Carbide Grains and Adhesive Tapes treating them as inputs used in or in relation to the manufacture of their final products needle rollers . He had held that the Silicon Carbide Grains are not tools and dropped the stand taken in the notice that the items which are used for rough polishing of needle rollers and for primary packing to protect them against dust and atmosphere are, therefore, more of a tool for polishing and packing and thus not eligible for modvat credit. In the appeal before the Collector (Appeals), the department had, inter alia, contended that Silicon Carbide Grain is used for repair of equipment, namely. Grindi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requiring replenishment would not be tools etc. which are excluded from the benefit of Modvat in terms of the Explanation under Rule 57A. In the present case, the Silicon Carbide Grains are not tools but a consumable item used in the manufacturing process, as held by the Assistant Collector in his order. Even the show cause notice conceded that they were used in the manufacturing process but only made out that they were in the nature of tools. This is not correct. Further, the allegation in the notice which is a different ground altogether and accordingly not permissible for the department to raise at the stage of appeal is also factually not correct. The silicon carbide grains are not used by them for repair of the grinding wheels. They ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umber of decisions in support of the proposition that what are excluded from the benefit of modvat benefit are those specifically mentioned in Explanation of Rule 57A as not included in the scope of the term inputs and that any product used in the machines is not, on that score, excludible from the benefit. Some of these decisions are as follows:- (1) 1990 (47) E.L.T. 376 - Collector of Central Excise v. Hindustan Development Corporation - E.R.B. (2) 1991 (56) E.L.T. 790 - Collector of Central Excise v. Avery India Limited - E.R.B. (3) 1992 (60) E.L.T. 635 - Andaman Timber Products v. Collector of Central Excise - E.R.B. (4) 1992 (57) E.L.T. 572 - Straw Products Ltd. v. Collector of Central Excise - E.R.B. (5) 1992 (61) E.L.T. 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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