TMI Blog1993 (11) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... ch have been declared as inputs under Rule 57G. These batteries are used in the manufacture of motor vehicles. The appellants vide their application dated 5-12-1988 requested for remission of duty of Rs. 25,066.37 BED and Rs. 649.88 SED in terms of Rule 57F(4)(c) on the ground that due to long storage excess sulphation had rendered the batteries dead and thereby the electrolysis process is lost. The Assistant Collector, Hosur vide the impugned order rejected the application for remission of duty on the plea that the appellants case is not covered by rule 57F(4)(c). He held that the batteries became dead due to long storage on the chassis which were held in stock. He also observed that the dead batteries which are in the nature of unservice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emission of duty on waste arising from the processing of the input if such waste arising out of the input is found unfit for further use or not worth the duty payable thereon and destroyed. (2) The batteries which were fitted to the motor vehicle and become unusable after a period due to long storage is not a waste arising from the processing of input, but only the input itself which has become unusable after some time due to excess sulphitation on long storage. Such a situation is not covered under Rule 57F(4). (3) In this case, the storage batteries fitted to the motor vehicles have become unfit as they have lost their electrolysis capacity due to long storage in the yard. Therefore, in this case the input viz. storage battery itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in the case of Kores India Ltd. has held that ribbon used in the typewriter is an accessory and therefore cannot be considered as part of the typewriter. This Bench in the case of M/s. Wipro Infotech Limited v. Collector, Bangalore in Appeal No. E/91/92, decided on 6-1-1993 [reported in 1994 (69) E.L.T. 82 (Tri.)] following the ratio of the judgment of the Hon ble Supreme Court cited supra, have held that ribbon used in the printer cannot be considered as an input in or in relation to the manufacture of printer. Likewise, in the case of watches we have held that batteries are not eligible for the benefit of MODVAT Credit. Vehicle as known in the market is complete without the batteries. To us it appears that the ratio of the Hon ble Sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under : Any waste arising from the processing of inputs in respect of which credit has been taken may - (a) be removed on payment of duty as if such waste is manufactured in the factory; or (b) be removed without payment of duty, where it belongs to such class or category of waste as the Central Government may from time to time by order specify for the purpose for being used in the manufacture of the class or categories of goods as may be specified in the said order, subject to the procedure under Chapter X being followed; or (c) destroyed in the presence of proper officer on the application by the manufacture and if found until for further use, or not worth the duty payable thereon the duty payable thereon being remitted." Under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocess of manufacture of the final product. The lower appellate authority has accepted this plea of the Respondent, observing that testing and inspection is an essential process in the manufacture of the goods and the lower appellate authority has allowed the Respondent s plea for remission of duty in terms of Rule 57F(4)(c). We would like to observe that there is nothing on record to show that these batteries were in fact issued and used for the purpose as set out in the lower appellate authority s order. No evidence in this regard appears to have been produced before the lower appellate authority nor the lower appellate authority himself has called for any record in this regard for verification of their plea. Be that as it may we observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uts unless there is a specific provision to the contrary. In this view of the matter we hold that in case an input has been held to be eligible and which is used in the final product and which becomes defective because of the use in conjunction with the final product and by virtue of that use becomes unusable, that has to be treated as waste. In the present case, however, we find that no basis has been laid that these batteries had in fact been used with reference to the vehicles and the learned lower appellate authority has not gone into any evidence in this regard. In view of the above, we hold that the impugned order is not a proper order and therefore has to be set aside and we remand the matter to the learned lower authority for de nov ..... X X X X Extracts X X X X X X X X Extracts X X X X
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