1994 (7) TMI 152 - AT - Central Excise

Summary

Issues:
- Entitlement to Modvat credit for Rubber Chemicals
- Interpretation of Rule 57G regarding declaration of inputs

Entitlement to Modvat credit for Rubber Chemicals:
The appeal was against the order denying Modvat credit for Rubber Chemicals, specifically "Pilfex-13" and "Pilnex TDQ," used as inputs due to the appellants' failure to mention these chemicals in the declaration filed under Rule 57G. The appellant argued that they had declared "Rubber Processing Chemicals" under Chapter 38 of the Central Excise Tariff, listing 8 different Rubber Chemicals under this general description. They contended that it was impractical to list all varieties of Rubber Chemicals individually due to the numerous types and trade names in the market. The appellant emphasized that there was no dispute about duty paid character or actual use of the disputed inputs in the final product. Citing case law, the appellant urged that the technical interpretation of the rule should be set aside.

Interpretation of Rule 57G regarding declaration of inputs:
The records revealed that the appellants had declared "Rubber Processing Chemicals" under Rule 57G, listing specific chemicals but not including "Pilfex-13" and "Pilnex TDQ." The appellants argued that since Rubber Chemicals are of various types and trade names, it was not feasible to list all chemicals individually. The Tribunal acknowledged the practical challenges due to the vast variety of Rubber Chemicals available in the market. Considering the absence of disputes regarding the duty paid character and the use of the disputed inputs in the final product, the Tribunal agreed with the appellants' contention. It was held that a narrow interpretation of Rule 57G should be avoided, and the disputed Rubber Chemicals could be deemed covered by the general description in the declaration. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellants, granting them consequential relief.