TMI Blog1999 (12) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... so to Rule 57A of the Central Excise Rules, 1944. (2) Whether on the facts and in the circumstances of the case the Appellate Tribunal is right in law in rejecting the Modvat credit on rejected pistons which are recycled in the manufacture of pistons. 2.The facts of the case are that the assessee claimed benefit of Modvat credit in respect of ramming mass. The Tribunal found that for an item to pass the test of eligibility to the benefit of the Modvat credit will be seen that they participate in the process of manufacture without which the end product cannot be produced. In processed materials which are used either in the preparatory stage for getting the materials ready for manufacture or which are used to render the finished product m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the object of benefit of Modvat in respect of inputs and cannot be restricted to components of the raw materials of the finished product which has gone into production of final product. It is submitted that the word "in relation to the manufacture" has extended the meaning of input and therefore, any item which is used as an input in relation to the manufacture is eligible for Modvat. Provision of Rule 57A are as under : "Provided that the Central Government may specify the goods or classes of goods in respect of which the credit of specified duty may be restricted. Explanation :- For the purposes of this rule, "inputs" includes - (a) inputs which are manufactured and used within the factory of production, in or in relation to, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les which are used for making container and it was held that the benefit under Rule 57A is available. Reliance in this case was made on the decision given in Collector of Central Excise v. Eastend Paper Industries Ltd, 1989 (43) E.L.T. 201 (S.C.), where it was observed, "As the Act does not define goods, the legislature must be taken to have used that word in its ordinary dictionary meaning. The dictionary meaning of the expression is that to become 'goods' it must be something which can ordinarily come to the market to be bought and sold and is known to the market as such. The Tribunal found, and there was material for the Tribunal to do so, that the market in which articles in question were sold were paper packed and wrapped in paper. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter. From the perusal of the provisions of Rule 57A it can be said that it is not only the input of those goods which are used as mesh from which final product is made. But input of those items which are in relation to the manufacture of the final product is also eligible for Modvat benefit. The rule making authority have used two phrases :- (1) goods used in relation to the manufacture. If either of these items have been used from which final product is the resultant then the benefit of Modvat can be claimed. The word "in relation to" is further clear from the explanation which has been given where it is mentioned that for the purpose of this rule input goods which are manufactured and used within the factory of production or in relatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the mould is not affected. After the casting is solidified and is taken out, the fettling operations are carried out. The felter mesh used remains as a part of the runner and riser which is re melted. Thus the filter mesh becomes a molten metal charge which is used for making final product. 2.RAMMING MASS (Dediolit 20) It is a high alumina refractory mass used for lining Induction Furnaces for melting and alloying of aluminium which is for manufacture of pistons. This ramming mass which comes in the form of powder is mixed with water, rammed and sintered in Induction Furnace to provide an insulative and workable crucible surface. This material is being imported presently because of non-availability of equivalent indigeneous materia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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