1994 (9) TMI 206 - AT - Central Excise

Summary

Issues:
- Whether coated Titanium metal Anodes used in the manufacture of caustic soda can be treated as an input under Rule 57A(i) of the Central Excise Rules, 1944.
- Whether Cathodes and Anodes used in the Electrolysis process can be treated as an input under Rule 57A(i) of the Central Excise Rules, 1944.

Analysis:
1. The reference application pertains to the Tribunal's order allowing the Respondents the benefit of MODVAT credit for coated Titanium Anodes used in manufacturing caustic soda.

2. The questions of law formulated include the eligibility of coated Titanium Anodes as inputs under Rule 57A(i) of the Central Excise Rules, 1944, considering the excluded categories of inputs mentioned in the explanation to the rule.

3. The Appellant argued that the coated Titanium Anodes should not be considered eligible for MODVAT credit as they were not directly used in the production of the end-product, warranting a reference to the High Court.

4. The Respondent's Advocate cited precedents where similar items were allowed MODVAT credit, emphasizing a Tribunal order rejecting a Reference Application against the benefit of MODVAT credit for aluminium sheets in the manufacture of a specified product.

5. After careful consideration, the Tribunal noted previous decisions allowing MODVAT credit for items like Graphite electrodes and titanium metal anodes used in similar processes. Citing the East Regional Bench's decision, it clarified that excluded categories under Rule 57A do not encompass parts like Titanium Anodes. The Tribunal also referenced the J.K. Cotton Mills Co. case to reject the Reference Application.

6. Consequently, the Tribunal held that Titanium anodes qualify as an eligible item for MODVAT credit, following established precedents, and dismissed the Reference application, finding no grounds for a High Court reference.