Customs, Excise and Gold Tribunal - Tamil Nadu
Sri Jayajothi And Co. Limited vs Cce on 5 July, 2005
ORDER P.G. Chacko, Member (J)
1. This application is for extension of stay of recovery of the balance amount due to the department as per the impugned order. After examining the records and hearing both sides, I am of the view that the appeal itself requires to be finally disposed of, having regard to the fact that the issue arising in th is case is already covered by a line of decisions of this Bench. Accordingly, after rejecting the stay application, I proceed to deal with the appeal. Mo dvat Credit of Rs 2,41,470/- was denied to the appellants in respect of "speed frame" which was one of the machines used by them for the manufacture of 'sliver' (carded/combed cotton), an intermediate product emerging during the course of manufacture of cotton yarn (final product). The said machine was received in their factory prior to 21.10.1994, the date on which sliver was specified as final product for Modvat purpose under Rule 57Q of the CE Rules, 1944. The view taken by the department is that, as the intermediate product for manufactur e of which the machine was used, was not a specified final product when the machine was received and installed in the factory, capital goods credit would not be available to it. This view has been rejected by this Tribunal in numerous similar cases, for instance, vide final order No. 919 to 927/03 dated 4.11.03 passed by the Tribunal in Appeal Nos. E/792, 793 and 316/1999 (CCE v. Sudharsanam Spinning Mills Ltd.)
2. In view of the above case law, it is held that the appellants are entitled to capital goods credit on "speed frame" installed in their factory received prior to 21.10.1994 and used for the manufacture of cotton yarn. The impugned order is set aside and this appeal is allowed with consequential relief.