TMI Blog2012 (12) TMI 266X X X X Extracts X X X X X X X X Extracts X X X X ..... e packing their finished goods - "welding electrodes". Since packing is held to be one of the essential components of the manufacturing process of the finished goods and being in the nature of incidental or/and ancillary to the main manufacturing activity, the assessee in this case was rightly held entitled to claim modvat credit on the item - "Hot Melt Unit" treating the same as capital goods under the Rule 57-Q ibid for claiming benefit - issue sought to be urged by the applicant (revenue) no longer remains resintegra - no referable question of law arises in the case - reference application fails and is accordingly dismissed. Decision in EASTEND PAPER INDUSTRIES Versus COLLECTOR OF C. EX., CALCUTTA [1989 (8) TMI 81 - SUPREME COURT OF I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to assessee, the item Hot Melt Unit was used by the assessee while manufacturing welding electrodes and hence they were entitled to claim modvat credit on this item as capital goods under the Rules. The case of the Revenue (Adjudication Authority) was that the assessee did not use the item - Hot Melt Unit in its manufacturing process but it was used by the assessee for packing and printing the cartons for keeping the welding electrodes in the cartons. It was therefore contended that since the item was not used in its manufacturing activities but was used in packing of welding electrodes and hence it cannot be termed as capital goods and nor any modvat credit can be taken on such item under Rule 57-Q ibid. 6. The Commissioner of appeals d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of CEGAT, Bombay in their own case, in which, it is observed that "apart from question of protection from moisture and other elements for which packing was done of the goods it is normal commercial practice to pack them for such purposes as identification of the manufacturer, type of goods etc. It would be irrational to accept only the view that of the Commissioner, without any support whatsoever that they could be marketed without packing. Marketability is an essential criterion for determining the liability of goods to excise duty and the process of rendering goods to market is a manufacture. The denial of the credit for this reason therefore cannot be sustained". 4. I fully agree with the view held in the above decision that the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the finished goods and hence the assessee is entitled to the benefits contained in the exemption notification in so far as it relates to wrapping paper is concerned. This is what their Lordships held in Para-8:- "8. To be able to be marketed or to be marketable, it appears to us, in the light of facts in the appeals, that it was an essential requirement to be goods, to be wrapped in paper. Anything required to make the goods marketable, must form part of the manufacture and any raw material or any materials used for the same would be component part for the end product. In our opinion, the Tribunal was right in the view it took. There is no ground to interfere in these appeals." 12. Similarly, the Supreme Court in the case reported i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal or/and ancillary to the main manufacturing activity, the assessee in this case was rightly held entitled to claim modvat credit on the item - "Hot Melt Unit" treating the same as capital goods under the Rule 57-Q ibid for claiming benefit. 14. In our view since the issue sought to be urged by the applicant (revenue) no longer remains resintegra and stands decided by the two decisions of the Supreme Court in favour of the assessee no referable question of law arises in the case. In other words, the view taken by the Tribunal is in accordance with the law laid down by the Supreme Court in aforementioned two decisions and hence this is not a fit case for calling any question proposed by the applicant from the Tribunal. 15. In the light ..... X X X X Extracts X X X X X X X X Extracts X X X X
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