1986 (5) TMI 167 - AT - Central Excise

Summary

Issues:
- Interpretation of Notification No. 201/79 regarding proforma credit on packing material.
- Whether packing material qualifies as an input in the manufacture of goods.

Analysis:

The case involved a revision application against an Order-in-Appeal regarding the refusal of proforma credit on corrugated boxes used for packing carbon and zinc elements. The Appellate Collector held that the packing of these goods cannot be considered as an input in their manufacture. The appellant argued that packing is essential to preserve the goods and cited relevant case law in their favor.

The Tribunal analyzed Notification No. 201/79, which exempted excisable goods where goods falling under Tariff Item 68 (referred to as inputs) were used in manufacturing to the extent of excise duty paid on the inputs. The Department sought to restrict the scope of 'input' to raw materials or components forming part of the finished products. However, the Tribunal noted that this restriction was introduced later through an amending notification. Therefore, the appellants were entitled to the benefit of the notification for using printed cartons on which duty had been paid in the manufacture of synthetic detergents.

In a similar case involving wooden drums used in packing electric wires, the Tribunal had previously ruled that packing materials could be treated as inputs for the purpose of a different notification. The Respondent did not provide any new arguments to challenge the previous Tribunal decisions, only mentioning that the Department had appealed.

The Tribunal concurred with the decisions in the cited cases and allowed the appeal, granting consequential relief to the appellant. The judgment emphasized the broad scope of the term 'input' and the importance of examining all aspects of the issue before making a decision.