1997 (7) TMI 328 - AT - Central Excise

Summary

Issues involved: Denial of Modvat credit on specified goods by the Collector.

Summary:
The appellants, engaged in cement manufacturing, filed a declaration for Modvat credit on capital goods but faced denial on certain items. The appellants contested the denial of credit on specific items falling into four categories. The learned Advocate for the appellants argued for the admissibility of Modvat credit on various items based on legal precedents and explanations under relevant rules.

1. Conveyor System Items:
The Tribunal referred to a previous decision where it was held that conveyor belts used in cement plants are entitled to Modvat credit under Rule 57Q. The Tribunal dismissed the Revenue's appeals related to conveyor system items, affirming their eligibility for Modvat credit.

2. Control Equipments:
The appellants argued that control equipments like switches, starters, etc., are essential for efficient plant operation, citing relevant explanations to support their claim for Modvat credit on these items.

3. Electrical Items:
Regarding electrical items, the appellants relied on the inclusion of such items under Chapter 85 for Modvat credit eligibility from a specified date. They referenced tribunal decisions to assert that electrical items should be considered capital goods for Modvat credit purposes.

4. Pollution Control Equipments:
Referring to a Supreme Court decision, the appellants contended that Pollution Control Equipment is part of plant and machinery, making it eligible for Modvat credit. The Tribunal agreed with this argument and allowed Modvat credit on Pollution Control Equipment.

In conclusion, the Tribunal found in favor of the appellants, allowing Modvat credit amounting to Rs. 7,04,553.47. The impugned order was modified accordingly, and the appeal was disposed of in favor of the appellants.