Customs, Excise and Gold Tribunal - Bangalore
Commissioner Of Central Excise And ... vs Panyam Cements & Mineral Indus. Ltd., ... on 24 October, 2001
JUDGMENT
S.S. Sekhon
1. In these two appeals the issue is of the eligibility of modvat credit as inputs under Rule 57A.
2. I have heard both sides. Since the issue involved in both the cases in same, they are being disposed off by this common order after hearing both sides, I find that
a) Lubricating oil and greases and their eligibility as inputs under Rule 57A of the Central Excise Rules, 1944 is no longer res-integra having been finally settled by the LB in the case of Modi Rubber Ltd reported in 2001 (119) ELT 197. Following the same I would also allow the modvat credit on the lubricating oil and greases in these cases.
b) As regards, the eligibility of modvat credit on welding electrodes, I find from the impugned order that the Commissioner (Appeals) has granted the credit based on the decision of Bajaj Auto Ltd reported in 1998 (99) ELT 479. The Ld. SDR submitted that welding electrodes can be inputs if used in or in relation to the manufacture of final products since in this case the said electrodes have been used for maintenance purpose therefore the case law relied by the Ld. Commissioner is not applicable and this credit should be denied under Rule 57A. Ld.SDR drew my attention to the findings in the order of the Asst. Commissioner that the welding electrodes were used in the factory for maintenance of plants and machinery.
c) I find that welding electrodes in this case are admittedly used for maintenance purpose. The submission of Ld. Advocate was that welding electrodes are used for maintenance of the machines and machinery which constitute as use in the manufacture of final products and the benefit of Rule 57A credit should be granted. I have considered the submission made by both sides and find that I am not persuaded to agree to the argument advanced by the learned Advocate. No doubt it is a fact that Supreme Court has ruled. There are other decisions and it is well settled law that the words 'use in' under Rule 57A have to be give a wide scope when they are interpreted, but I am not inclined to give such a wide scope to conclude that electrodes used for maintenance of machinery and machines which are in nature of capital goods in turn used in manufacture of final products then such electrodes would be covered by Rule 57A. I find that relying on the decision in the case of G.D. Rathi Steel Ltd by a Bench of this Tribunal as reported in 2001 (130) ELT 819 (Tri-Delhi), wherein it was held that welding electrodes being not used in or in relation of manufacture of goods, modvat credit was not admissible under Rule 57A of Central Excise Rules, 1944. I am bound by this Bench decision and following the same, I disallow the credit on welding electrodes under Rule 57A in the facts of this case.
3. In view of my finding the appeals are disposed off in the above terms i.e. credit on lubricating oil is admissible which credit on welding electrodes for manufacture of plants and machinery is not admissible under rule 57A. Thus these appeals and cross objection are disposed off in the above terms.
(Pronounced and dictated in the open court).