Customs, Excise and Gold Tribunal - Tamil Nadu
Commissioner Of Central Excise, Guntur vs The Kcp Ltd. on 21 September, 2001
JUDGMENT
P.G. Chacko
1. In this appeal filed by the Revenue, the question arises as to whether the respondents were entitled to take Modvat Credit of the duty paid on Portable Truck Loading Unit as capital goods under Rule 57Q of the CE Rules 1944. Both the lower authorities concurrently held that the above goods were used in the process of manufacture of sugar in the respondents' factory and hence eligible for Modvat Credit under rule 57Q. In the present appeal, the only substantive ground raised by the Revenue is that the Commissioner (Appeals) failed to take note of the fact that Portable Truck Loading Unit was not used in the process of manufacture of the product and hence it was not capital goods.
2. The appellant is represented by Shri Sounderarajan, learned DR. There is no representation for the respondents today. From the record of proceedings, I note that the appeal was posted to this date for hearing as per the stay order No. 498/2001 dated 13.09.2001 which was passed by the Bench in the absence of the respondents. No notice of hearing for this day appears to have been issued to the Respondents subsequently. However, I am inclined to dispose of the appeal today itself after hearing the learned DR.
3. The learned DR has reiterated the above ground of appeal. He submits that the goods in question were used only for transporting the final product (sugar) from the respondents' go-down to the loading point and from there to the vehicle and, therefore, the goods cannot be treated as having been used in the manufacture of sugar.
4. I am unable to accept this plea inasmuch as it is well settled by a series of decisions of the Hon'ble Supreme Court and the Tribunal that any activity undertaken by the manufacturer for the purpose of making the final product marketable is a part of the process of manufacture. Without transportation of the goods from the respondents' go-down to the loading point, the goods cannot be said to be in marketable stage. Therefore, the capital goods used for such transportation should be treated to have been used in the manufacture of sugar and consequently the same will be eligible for Modvat Credit under Rule 57Q of the CE Rules, 1944. Therefore, I fully agree with the order of the lower appellate authority and reject the present appeal of the Revenue.
(Dictated and pronounced in open Court)