Customs, Excise and Gold Tribunal - Delhi
C.C.E., Chandigarh vs M/S. Oswal Paper & Allied Industries ... on 22 March, 2001
ORDER K.K. Bhatia, Member (T)
1. The respondents are the manufactures of uncoated paper and paper board used for writing and printing falling under Chapter Heading 48 of Schedule to CE Tariff Act, 1985. The Commissioner (Appeals), Chandigarh vide his Order dt. 10.5.99 has allowed them the modvat credit totally amounting Rs. 33,276.40 on the capital goods reversing the order passed by the original authority. the particulars of the goods are as allows:
1. EMDOs HDPE It is used in carrying of calcium hydrochloride to the pulp mill for bleaching the pulp.
2. Plascon V-Ball Valve It is used in Alum limes to control the supply. It is a part of the machine.
3. Electric Motor for It is electric motor for paper machine drive.
paper plant machinery
4. Breaker Beater It is used for heating the complete with rags and jute caddies. Without washing drum this equipment, strength cannot be given to the paper
5. WCI Pulp Value with These are used in each and spindle every equipment to regulate the supply to maintain the pressure of pulp and to shut or open the delivered pulp in all the stages and steak the pulp.
6. Demble make glove These are used for seal control valve pos- tank lead controls the supply itioner of black liquir (Machinery part)
7. Fenner V Belts It is used for straw cutters and agitators for rotating the pulp
8. Spray Nozzles It is used for cleaning of the felt to improve the quality and productivity of paper machinery (Machinery part)
9. Disc for 17" Purason TDR It is used for refining the TDR pulp in the TDR 17" refiner (Machinery part).
2. The Commissioner (Appeals)l has also reduced the penalty imposed on the party from Rs. 50,000/- to Rs. 5,000/-
3. The Revenue are in appeal against the above order of Commissioner (Appeals). I have heard Shri M.D. Singh, SDR for the Revenue. The respondents are not represented. It is contended in the Revenue appeal that the definition of "capital goods" as stood at the relevant time was "restrictive" and this expression could be interpreted only for the goods which had a direct role for production/processing or for bringing about any change in the substance for the manufacture of final products. It is contended that this definition clearly excluded the impugned items. Since these are not used in the manufacture for final products, therefore, the modvat credit availed by the party is not admissible. I have considered these submissions. It is observed that the Commissioner (Appeals) in respect of each item has given his findings as to how they are used in the manufacture of final products and therefore, they are falling within the definition of the expression "capital goods" as provided under Rule 57Q. In the appeal of the Revenue, there is not even whisper about the findings recorded by the Commissioner (Appeals) with regard to function of each of the item and its use in production/processing or for bring about any change in the substance for the manufacture of the final products undertaken by the respondents. The Revenue therefore, have not made out any case against the order passed by the Commissioner (Appeals) and there is no ground to interfere in the same. The appeal therefore, fails and the same is accordingly, rejected.
(Announced and dictated in the Court)