2003 (8) TMI 130 - AT - Central Excise

Summary

Issues:
1. Denial of Modvat credit on HR/CR Sheets, HR/SS Plates, and Plain Plates.
2. Denial of Modvat credit on thermocouples.

Analysis:
1. The appellants, manufacturers of non-ferrous metals, claimed Modvat credit on certain items under Rule 57Q of the Central Excise Rules, 1944. The show-cause notice alleged that the sheets and plates used as raw materials were not parts of machinery under Rule 57Q. The Commissioner (Appeals) upheld the denial of Modvat credit. The main argument by the appellants was that the sheets and plates were components or spares of machines and should be eligible for credit. However, the Tribunal found no specific evidence regarding the identity of the machines in question, making it impossible to determine if the items qualified as components or spares under Rule 57Q. As a result, the denial of Modvat credit on sheets and plates was upheld. Regarding thermocouples, the denial of credit was upheld as they did not qualify as capital goods for Modvat credit.

2. The Tribunal considered the arguments presented by both parties. The appellants relied on previous decisions to support their claim for Modvat credit on the items in question. However, the Tribunal emphasized the importance of establishing the identity of the machines for which the items were claimed to be components or spares. Without this specific evidence, it was deemed futile to decide on the eligibility of the items for Modvat credit. The Tribunal referred to a previous decision upheld by the Supreme Court to support this reasoning. Consequently, the denial of Modvat credit on sheets and plates was upheld, while the denial on thermocouples was also maintained due to their classification not meeting the criteria for capital goods under Rule 57Q.

Overall, the appeal challenging the denial of Modvat credit on the mentioned items was rejected by the Tribunal based on the lack of evidence regarding the identity of the machines for which the items were claimed to be components or spares, leading to the conclusion that they did not qualify for the credit under Rule 57Q.