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TMI Blog1997 (7) TMI 382X X X X Extracts X X X X X X X X Extracts X X X X ..... r the purpose of repair, the ship has to enter the dry dock premises. To facilitate the movement of the vessel, the Caisson Gate is to be shifted away from its original position. During the course of manufacture or repair, the gate is completely closed in which case it acts as a water tight door for the dock. This prevents any sea water from flooding the dry dock. After the repair work is over, the gate is again lifted so that the vessel can sail out of the dry dock into the sea. It is thus, in the nature of a gate which only function is to protect the dry dock area from the submergence of sea water. The question therefore to be determined in the appeal is whether the item in question, the manner in which it is used can be taken to be of the nature covered under the aforesaid Notification. 2. Shri Sarveswara Row, learned Counsel for the appellants does not contest the factual position as to the manner in which Caisson gate is used. The plea however is that since the Caisson gate as such is manufactured and is installed therein and its use is essential for carrying out the operations in the shipyard, the benefit as claimed in terms of the Notification should be allowed. The l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attention to the judgment of the Hon'ble High Court of Orissa reported in Vol. 74 STC 296. To elaborate the term 'use' in Para 13 of the judgment the following has been set out : Rs. 13. The Gujarat decision AIR 1969 Guj. 344 (Jafarabad Municipality v. Kathiawar Industries Ltd.) has delved deep to construe the expression "use" and again I may usefully utilise the labour put in by the learned judges in that case. According to the dictionary meanings, the word "use" is generally meant to convey the meaning "to employ for, or to apply to a given purpose". In a taxing provision, the expression has to be noticed in the matter of its context. Although the expression "consumption" in its wider sense would also be an "user", but since the taxing provision has used the word "use" along with the word "consumption", it is reasonable to hold that the legislature contemplated in the word "use", "the user" of any goods in a sense other than "consumption". In order to bring home this point, the decision has given the illustration of the user of steel furniture, precious stones and ornaments, a motor car and thereafter made a very apt observation with which I respectfully agree, that "alth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under: 4. We have considered the pleas made by both the sides. We observe that on reading of the definition of capital goods as set out under Rule 57Q, we ourselves had entertained a doubt prima facie that the equipment like Fork Lifts may not be covered by this definition. A plain reading of the definition would appear to indicate that the activities in which the capital goods are to be used have to be such that these are for either producing or processing of the inputs or for bringing about any change in the materials used for the manufacture of the finished products. However we observe that the scope of Modvat Scheme was enlarged to cover the capital goods with a view to give relief to the industry from cascading effect of duty. The term 'capital goods' therefore has to be read in the context of the use of the equipments in the assessee's factory. What has to be seen is whether the equipment used is a part of the manufacturing stream in the assessee's factory and whether the use is for production or processing or for bringing about any change in the materials used in the manufacture of the final product. The Hon'ble Supreme Court in the case of Collector of Central Exci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the learned lower authority for this limited purpose. We dismiss the appeal subject to the above observations. Further, reliance was also placed on the decision of the Tribunal in the case of Cochin Port Trust reported in 1992 (57) E.L.T. 321 = 1992 (42) ECR 381 (T). In that case, the issue related to the benefit of Notification 118/75 i.e. use of the goods manufactured within the same factory. The Tribunal in that case has held as under (paras 5 to 7) : 5. It has been contended on behalf of the appellant Collector that even though the dry-dock was adjacent to the workshop/factory where the goods were being manufactured, the excisable goods used for the repair of vessels in the dry-dock were not eligible for exemption under Notification No. 118/75 since in terms of Section 2(e) of the Central Excises and Salt Act, 1944 the dry-dock where no manufacturing activity was carried out could not be deemed as part of the factory or its precinct. In this regard it is seen that in the case of Delhi Cloth and General Mills Co. v. Joint Secretary, Govt. of India reported in 1978 (2) E.L.T. (J 121) the Honourable Supreme Court has observed that the definition of "factory" in Section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption was in existence in terms of Notification No. 118/75, dated 30-4-1975, which, however, did not make any mention of workshop. In 1983 (12) E.L.T. 209 (Kar.) M/s. India Sugars & Refineries Ltd. v. Union of India and Others, interpretation of a notification has been discussed :- "If an expression in Notification is used in plain and meaningful language there is no scope for assuming an ambiguity and trying to interpret it on a supposed intention of the makers of the notification." Further in 1983 (13) E.L.T. 1017 (CEGAT), Hercules Tyre & Rubber Industries v. Collec- tor of C. Ex., Chandigarh, it has been indicated that "the notification should not be construed in a manner which defeats the very purpose of the notification." 7. In the case before us we find from the impugned order that the Collector (Appeals) after inspecting of the relevant sketch map has recorded the finding that the dry-dock was surrounded by various sections of the workshop like welding, fabricating, carpentry, foundry, blacksmithy, tin-smithy etc. and these sections of the workshop including the dry-dock were surrounded by a single compound wall with one entrance from the road side. Under these c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been further observed that where any particular process is so integrally connected with the ultimate production of goods and but for that process, the manufacture would or the process of the goods would be impossible, or commercial expedient that process is the one in relation to the manufacture. We observe that in that case, the issue that fell for consideration was in the context of Notification 179/77 whether pump used in relation to the manufacture of the goods in question for the purpose of consideration of the benefit of the Notification which was available in respect of the goods manufactured without the aid of power. Lifting of water by use of power in that case was held to be process related to the manufacture of the goods and the benefit of notification was denied to the assessee. In the case of Nabin Chandra Narayan Das reported in STC cases Vol. 74 page 296, the issue related to levy of octroi which was leviable under Section 131 of the Orissa Municipal Act, 1950 on the goods brought within the municipal limits for consumption, use or sale therein. In that case, the Hon'ble High Court held that the films brought for exhibition can be taken to be for use in the muni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r carrying out the operation for the manufacture of the goods falling under tariff heading set out under the Notification. It is possible that with the help of this Caisson Gate, necessary environment is created for the manufacture of the goods in question by providing a dry place and that cannot be equated with the process of manufacture of the goods in question. The process of manufacture of the goods in question may start with the preparation of the materials and taking up the structural work for various operations with reference to that. The use of the Caisson Gate can be taken to be in relation to the manufacture of goods but the notification does not give the assessee benefit in respect of goods which are used in relation to the manufacture of the notified finished product as these words are missing in the notification. The word "used" in the manufacture has to be taken with reference to the integrality of operations of the manufacture of a given product. Various processes involve in the manufacture of a given product for the beginning and end. The manner in which Caisson Gate is used cannot be taken to be in any way integrally connected with the process of manufacture of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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