TMI Blog2023 (12) TMI 844X X X X Extracts X X X X X X X X Extracts X X X X ..... wed. - HON BLE MS. SULEKHA BEEVI C.S., MEMBER (JUDICIAL) HON BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL) For the Appellant : Shri R. Janardhanan Pillai, Consultant For the Respondent: Shri Rudra Pratap Singh, Additional Commissioner / A.R. ORDER Order :- [Per Ms. SULEKHA BEEVI C.S.] The issue involved in all these appeals being the same, they were heard together and disposed of by this common order. 2.1 The appellant is engaged in the manufacture of Hand Sewing Needles falling under Chapter 73191020, Aluminium Knitting Pins under 76169990, Plastic Knitting Pins under 39269099, Safety Pins under 73192000. The main raw material/inputs used for manufacture of the above finished products are aluminium ingots. They avail credit of the duty paid on aluminium ingots used as inputs for manufacture of the finished products. The appellant also manufactures jig wires and jig rods out of the CENVAT Credit availed input, and these jig rods / jig wires were captively consumed without payment of duty availing the exemption of Notification No. 67/95 dated 16.03.1995 by classifying the jig rods and jig wires under Chapter Heading 76169990. 2.2 It appeared to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al goods in 2(a) of CENVAT Credit Rules, 2004, at clause (iv) states that moulds and dies, jigs and fixtures are capital goods. 3.3 This issue was considered by the Tribunal in the appellant s own case for the period from February 1997 to June 2005 and the demand was set aside vide F.O.No. 40690-40694/2014 dated 11.08.2014. For the period from July 2011 to Aug 2015, though the adjudicating authority confirmed the demand, on appeal, the Commissioner (Appeals) set aside the demand following the Tribunal s order. Similarly, the demand for the period September 2015 to April 2016 was set aside by the Commissioner (Appeals). The demand raised in the Show Cause Notice for May 2016 to March 2017 was dropped by the adjudicating authority. It is submitted that the present appeals pertain to intervening period from July 2005 to June 2011. The Department cannot take a contrary stand as they have not filed any appeals against the orders passed by Commissioner (Appeals). The Ld. counsel prayed that the appeals may be allowed. 4. The Ld. Authorised Representative Shri Rudra Pratap Singh appeared and argued for the Department. The meaning of jig was explained by adverting to various defi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the present case. The ratio laid down therein fully applies to this case, 11. In this view of the matter, we set aside the impugned Judgment and the Order of the Commissioner of Central Excise. It is held that the Appellants will be entitled to Modvat credit on duties paid for the inputs used for manufacture of parts, so long as the parts are used in the manufacture of tractors on which duty is paid. We clarify that in respect of parts which are sold in the open market and/or used for manufacture of tractors on which no duty is paid, the benefit of the Notification No 217/86-C E., dated 2nd April, 1986 may not be available. He also relied upon the decision of the Tribunal in the case of Shalimar Paints Ltd. Vs. CCE Calcutta 1994 (72) ELT 186 (Tribunal), wherein the appeal of the assessee was allowed. The relevant portion of the judgement is reproduced below :- 6. The claim made by the present Appellants before the Collector (Appeals) that the resins are intermediate products in the manufacture of paints was rejected by that authority on the ground that they were fully manufactured products attracting classification under sub-heading 3907.50. The fact that alk ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t held that there were four kinds of inputs which could be said to be ingredients (i) those which retain their dominant individual identity and character throughout the process and also in the end-product, (ii) those which, as a result of interaction with other chemicals or ingredients, might themselves undergo chemical of qualitative changes and in such altered form find themselves in the end-product, (iii) those which like catalytic agents, while influencing and accelerating the chemical reactions themselves remain uninfluenced and unaltered and remain Independent of and outside the end- products; and (iv) those which might be burnt up or consumed in the chemical reactions. In the present case, we find that the jig wires and jig rods were consumed in the process of manufacture of Knitting Pins. The Commissioner (Appeals) also accepted that these goods are intermediate products. It is also noted that these goods are essential for the manufacture of final product. 5. In view of the above discussion, we consider that these Items are Intermediate products captively used in the manufacture of dutiable final product and therefore cenvat credit cannot be denled. Accordingly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the manufacture of knitting pins which are the final products. 11. Alternatively it is seen that the said goods also can be treated as Capital goods under Sl. No. (I) of the above Notification. 12. Cenvat Credit Rules 2004 defines Capital Goods' as follows: Capital Goods means:- the following goods namely:- (i) All goods falling under Chapter 82, Chapter 84 Chapter 85, Chapter 90, heading no.68.02 and sub-heading no. 6801.10 of the First Schedule to the Excise Tariff Act; (ii) pollution control equipment; (iii) components, spares and accessories of the goods specified at (i) and (II); (iv) moulds and dies, jigs and fixtures; (v) refractories and refractory materials; (vi) tubes and pipes and fittings thereof; and (vii) storage tank used -(1) in the factory of manufacture of the final products but does not include any equipment or appliance used in an office. 13. Thus jigs and fixtures are also specifically mentioned under the definition of 'capital goods' under Cenvat Credit Rules 2004 without ascribing chapter heading. 14. In view of the above discussion under the provisions of law I am of the firm view th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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