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TMI Blog2001 (7) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... htagi, for the parties. Senior Advocates: Sudhir Chandra, Ranjit Kumar and Joseph Vellapally, for the parties. In person:Respondents in C.A. Nos. 2187 to 2195 of 2000, 2147 to 2149 of 2000 and 3012 of 2000, for the parties. Other Advocates: N.K. Bajpai, K. Swami, Ms. Nisha Bagchi, Ms Smitha Inna, K.C. Kaushik, R.N. Poddar, Rajiv Nanda, B.K. Prasad, Rana Mukherjee, Ms. Sumita Mukherjee, P.K.. Ganguly, V. Lakshmikumaran, M.P. Devanath, B.L. Narasimhan, V. Balachandran, Rajesh Kumar, Balbir Singh, Dayan Krishnan Nikhil Nayyar, Trideep Pais, Ms. Meenakshi Arora, H.K. Puri, S.K. Puri, Rajesh Srivastava, Ujjwal Banerjee, Ms. Anindita Gupta, Vijay K. Jain, M.P. Shorawala, M.P. Vinod, U.A. Rana, Ms. Binu Tamta, Varun Goswami, Ravinder Narain, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reads as under : "57Q Applicability. - (1) The provisions of this section shall apply to finished excisable goods of the description specified in the Annexure below (hereinafter referred to as the 'final products') for the purpose of allowing credit of specified duty paid on the 'Capital goods' used by the manufacturer in his factory and for utilising the credit so allowed towards payment of duty of excise leviable in the final products, or as the case may be, on such capital goods, if such capital goods have been permitted to be cleared under Rule 57S, subject to the provisions of this section and the conditions and restrictions as the Central Government may specify in this behalf : Provided that credit of specified duty in respect of an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 13th April, 1999, considered various items which were involved in different appeals and by a common judgment and order decided the controversy in favour of the manufacturers rejecting the stand of the revenue that those are not 'Capital goods' within the meaning of Explanation (1)(a) defining 'Capital goods'. Some of the items considered by the Tribunal are : power cables and capacitors in case of Jawahar Mills Ltd.; control panels, cables distribution boards, switches and starters and air compressors in the case of Indian Refrigeration Co. Ltd.; electric wires and cables in the case of Kothari Sugar and Vijay Chemicals. The Tribunal on consideration of the aforesaid provision and various decisions including some of this Court one of it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... final product and the only requirement is that the same should be used in the factory of the manufacturer. Thus, it can be seen that the language used in the explanation is very liberal. 5.In the case of Indian Farmers Fertiliser Cooperative Ltd. (supra) this Court interpreted the notification which conferred exemption in respect of such raw naphtha as was used in the manufacture of ammonia provided such ammonia was used elsewhere in the manufacture of fertilizers. The facts of that case were that the appellant was manufacturer of urea - a fertilizer and utilized for that purpose raw naphtha. The question therein was whether ammonia used in the off-site plants was also ammonia which is "used elsewhere in the manufacture of fertilizers". T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d therein for the manufacture of final products, it would satisfy the test of 'Capital goods'. The main contention of Mr. Rohtagi, however, is that the question whether an item falls within the definition of 'Capital goods' would depend upon the user it is put to. The submission is that parts of the items in respect whereof availing of Modvat credit has been allowed by the Tribunal could not be treated as 'Capital goods' as the manufacturer could not establish that the entire item was used in the manufacture of final product. To illustrate his point, Mr. Rohtagi submitted that part of a cable may go into the machine used by the manufacturer and, thus, may qualify the requirement of clause 1(a) and, at the same time, another part of the cabl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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