Customs, Excise and Gold Tribunal - Delhi
Commissioner Of C. Ex. vs Crompton Greaves Ltd. on 15 April, 2002
Equivalent citations: 2002ECR75(TRI.-DELHI), 2003(161)ELT201(TRI-DEL)
ORDER K.K. Bhatia, Member (T)
1. The respondents manufacture Transformers and its parts falling under Chapter Heading No. 8504.00. They are also availing the Mod-vat credit on inputs under Rule 57A of the Central Excise Rules, 1944. During the month of June and July, 1998, they took credit of Rs. 2,079/- on the input items viz., Support Angles & Bracket Lashing purchased by them. The Deputy Commissioner of Central Excise, Gwalior vide his Order dated 29-5-1999 denied them the Modvat credit of this amount on the ground that these items are essentially packing material. He observed that support angle and bracket lashing are fixed with the truck body for safe transportation of the transformer and cannot be said to be the material used for packing of the transformer apart from denying the Modvat credit, he also imposed a penalty of Rs. 250/- on them.
2. The party filed an appeal and the Commissioner (Appeals), Bhopal vide his Order dated 27-5-1999 allowed the appeal of the party. The Commissioner (Appeals) observed that these are essential items for making the transformers marketable. Therefore, these cannot be held as ineligible for availing the Modvat credit.
3. This is a revenue appeal against the impugned order of Commissioner (Appeals). I have heard Shri H.C. Verma, JDR for the revenue. The respondents are not represented despite the notice. In the revenue appeal, it is contended that the support angles and bracket lashing are used for transportation of transformer. They are used to weld the transformer at one end of the truck body for transportation. Therefore, it is contended that these items do not appear to be the inputs for the transformers nor are they packing materials but appear to be structural items used for the transportation of the goods. I have considered these submissions. It is not in dispute that the items under question are supplied with the transformer. The value of these items is included in the value of the transformer for the purpose of payment of duty. It is also not contested that the transformer as such cannot be marketed if these items are not supplied along with it for transportation. In the face of these facts, I do not find anything in the provisions of Rule 57-I which would call for recovery of the Modvat credit availed by the respondents on these items. I, therefore, reject the revenue appeal by upholding the order passed by Commissioner (Appeals).