TMI Blog1995 (3) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture of Acetylene Gas and Oxygen. The original authority after examining the facts came to the conclusion that the two items were used in or in relation to the process of manufacture of the gases. The Department took up the matter in appeals before the Collector (Appeals), who has also come to the same conclusion after considering the pleas of both sides. The learned Collector (Appeals) has held as under : According to the Respondent, this is a process followed all over the world and this is one of the essential process in the manufacture of Acetylene gas. The appellant s ground for denying the Modvat credit in this is that the Regenetal cannot be considered as an input as it acts only as a purifying agent and it is repeatedly used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r absorbing moisture in the manufacture of Oxygen could not be taken to be used in or in relation to the manufacture of Acetylene gas and Oxygen respectively. Reliance has been placed by the appellant-Collector on the circular of the Ministry bearing No. 34/90-CX VIII (F. No. 261/12/18/90-CX VIII) in the case of phosphoric acid that its use in the manufacture of sugar cannot be regarded as an input for purpose of MODVAT credit and the same ratio is applicable to the facts of the case before us. 2. The learned DR reiterated the grounds of appeal. 3. The learned Advocate for the respondents has pleaded that as it is so far as phosphoric acid is concerned various, Benches of the Tribunal have held that use of phosphoric acid in the purific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f repetitive use that would stand excluded from the purview of the MODVAT credit under Rule 57A. We observe under Rule 57A the eligible inputs and the finished products in which the same can be used have been notified and by way of explanation the type of goods which would not be considered as eligible inputs for MODVAT purposes have been specified. The definition of input as given in the Rule 57A is set out below : Explanation. - For the purposes of this rule, inputs" includes- (a) inputs which are manufactured and used within the factory of production, in or in relation to, the manufacture of final products, and (b) paints and packaging materials, but does not include (i) machines, machinery, plant, equipment, apparatus, to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the fact that the use of the two items in question is a technical necessity and there is no averment to the contrary from the Revenue in this regard. In fact in the grounds of appeal it stands conceded that the two items participate in the manufacturing process. We observe that so long as an item is used in the process of manufacture and it is not covered by the excluded categories in the Explanation to Rule 57A as above, the benefit of MODVAT credit will have to the given. It is not the case of the Revenue that the use of the material is for making the equipment used functional for the manufacture of the goods in question. In view of the above we hold the orders of the learned Collector (Appeals) are maintainable in law and the appeals t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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