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2006 (7) TMI 226

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..... r, we thought it appropriate to deal with the case on merit first. 4. Brief facts of the case are that the assessee in the present case, who is registered with the Department, availed Modvat credit of Rs. 26,100/- under Rule 57Q of the Central Excise Rules, on account of purchase of duty paid capital goods i.e. electrical transformers falling under heading No. 8504. Finding that the assessee had wrongly entered the Modvat credit in its RG 23 C Part II, the electrical transformer not being covered under the Scheme for availing Modvat credit, the adjudicating authority issued show cause notice. The assessee controverted the allegation in the show cause, inter alia, submitting that even prior to the issuance of Notification No. 11/95-C.E. (N.T.), dated 16-3-1995 "Capital Goods" which were used in manufacturing of final products were eligible for Modvat credit in terms of Rule 57Q and 57T of the Rules and that the term "Capital Goods" is quite wide to include electrical transformer therein. Rejecting the contention of the assessee, the Assistant Commissioner Central Excise disallowed Modvat credit of Rs. 26,100/- vide order dated 25-9-1995. 5. The assessee preferred an appeal again .....

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..... e manufacture of final products; (b) components, spare parts and accessories of the aforesaid machines, machinery, plant, equipment, apparatus, tools or appliances used for aforesaid purpose; and (c) moulds and dies, generating sets and weigh bridges used in the factory of the manufacturer." 7. A bare perusal of the definition of "capital goods" given in the Rules shows that the same is quite wide and liberal. 8 In our view the issue raised in the petition is squarely covered by the judgment of Hon'ble the Supreme Court in Commissioner of Central Excise, Coimbatore and others v. Jawahar Mills Ltd. and Others - 2001 (132) E.L.T. (S.C.) = 2001(6) Supreme Court Cases 274, wherein considering Rule 57Q of the Rules, it was held as under : "4. The aforesaid definition of "capital goods" is very wide. Capital goods can be machines, machinery, plant, equipment, apparatus, tools or appliances. Any of these goods if used for producing or processing of any goods or for bringing about any change in any substance for the manufacture of final product would be "capital goods", and, therefore, qualify for availing MODVAT credit. Per clause (b), the components, spare parts .....

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..... for the manufacture of final products. 12. In view of our above discussion, we do not find any merit in the arguments raised by the counsel for the Revenue that the electrical transformers will not fall in the category of capital goods as per Rule 57Q of the Rules. Accordingly, the petition is dismissed. 13. In view of our above findings, we do not deem proper to deal with application for condonation of delay. 14. Before parting with the order, we are constrained to record our displeasure in the manner in which the officers of the petitioner department are conducting this case, which involved a sum of Rs. 26,100/-. The Revenue must have spent more than the duty as expenses and professional fees besides spending huge amount of man hours at various levels for dealing with the filing of petitions and visiting different places in connection with this case, which is covered against the Revenue. The manner in which this case has been conducted by the Revenue leaves a very bad impression. 15. As is evident from application for condonation of delay, after the receipt of the order of the Tribunal, following steps were taken. The relevant details thereof contained in application are .....

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..... uirements/formalities as desired by the Govt. Counsel were completed in all respects. 13. That the letter dated 1-4-2004 was received from the office of Govt. Counsel addressed to the Divisional office Central Excise, Panchkula. In the said letter it was mentioned that the reference petition filed in the Hon'ble Delhi High Court are to be in fact adjudicated by Hon'ble Punjab and Haryana High Court at Chandigarh as per High Court's decision in the matter of Commissioner of Central Excise III v. Haryana Acrylic Co. (P) Ltd. (2001) and more recently in Commissionerate ofCentral Excise III v. Enkay HWs India Ltd.-2002 (139) E.L.T. 21 (Del.). 14. That the letter dated 1-4-2004 was received by the Divisional office Central Excise, Yamuna Nagar on 5-4-2004. The Divisional office further brought all these facts to the notice of the Commissionerate at Panchkula vide letter dated 13-4-2004. 15. That the letter dated 13-4-2004 was received by the Commissionerate office on 20-4-2004. The Commissioner vide its letter dated 21-4-2004 directed the Assistant Commissioner, Central Excise, Yamuna Nagar to immediately depute the officer to collect the records from the Govt. C .....

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