2002 (3) TMI 641 - AT - Central Excise

Summary

Issues: Appeal against Modvat credit grant for specific items under Central Excise Rules.

Analysis:
1. The appeal was filed against the Order-in-Appeal granting Modvat credit for various items. The Commissioner (Appeals) upheld the contention for Modvat credit, considering the items as eligible capital goods crucial for manufacturing the final product. The Tribunal's decision was referenced during the assessment.

2. The Revenue, represented by Shri C. Mani, argued that the items in question did not meet the criteria of capital goods under Rule 57Q of the Central Excise Rules. The contention was that the items were not machinery, plant, or equipment directly involved in the manufacturing process or bringing about a change in the goods for the final product.

3. The Revenue further emphasized that the disputed items should not be classified as capital goods, urging the order to be set aside based on the interpretation of the relevant rules and definitions.

4. The Respondent's representative, Shri Mohan, referenced a Supreme Court judgment in the case of Commissioner v. Jawahar Mills Ltd., asserting that the issue at hand was similar to the one addressed in the mentioned case, supporting the eligibility of the items for Modvat credit.

5. The judgment analyzed the function of each item and its necessity in the manufacturing process. It highlighted a previous Tribunal decision in the case of Jawahar Mills Ltd. v. CCE, where Modvat credit was granted for similar items. The Apex Court upheld the Tribunal's decision, setting a precedent for granting such benefits. The judgment concluded that the items in question were essential for manufacturing the final product, aligning with the Tribunal's and Apex Court's decisions, thus rejecting the Revenue's appeal.