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TMI Blog2005 (8) TMI 610X X X X Extracts X X X X X X X X Extracts X X X X ..... 02. 2. The Revenue has filed the present appeal on the ground that the respondent is engaged in the manufacture of UPS Systems and for the said systems the PCBs and transformers are the intermediate products for which the respondent had claimed the exemption under Notification No. 67/95 dt. 16-3-1995. Up to March 2000, Rule 57D(2) of Central Excise Rules, 1944, provided for eligibility of credit on inputs used in the manufacture of intermediate products even though the intermediate products were exempted from duty. Therefore the respondent was eligible for Modvat credit on inputs used in the manufacture of PCBs and Transformers only up to March 2000. However, after the introduction of the Cenvat credit on inputs w.e.f. 1-4-2000, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t applicable and the demand is clearly time barred. 4. Personal hearing was fixed on 12th July, 2005, S/Shri Bharat Raichandani, Advocate, Ramdas Gadiyar Advocate and P.K. De, Manager Excise have attended on behalf of the respondent and reiterated the arguments advanced in their cross objection. 5. The term input was defined in Rule 57A which came into force w.e.f. 1-4-2000 as follows : "Input" means all goods used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not, and whether used as packing material or as fuel, or for generation of electricity or steam, except high speed diesel oil and motor spirit, commonly known as Petrol. Explanation - T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... words 'in relation to manufacture' convey the meaning of the indirect participation of the inputs in the manufacture of final product. Subject to the condition that the indirect participation is essential to the manufacture of the final product. In view of the above I find that the respondent is eligible for Modvat credit. The respondent could not maintain separate inventory/accounts, he was liable to pay an amount equivalent to 8% of the price of exempted goods, which he had already been paid. Therefore, the impugned order passed by the lower authority is correct and I do not find any reason to interfere with the impugned order passed by lower authority.
8. In view of the above, I uphold the impugned order and reject the appeal. X X X X Extracts X X X X X X X X Extracts X X X X
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