Admissibility of Modvat credit on oxygen and acetylene gas used in oxy-acetylene flame/torch - Clarification regarding - Central Excise - 261/72/12/87-CX.8

Admissibility of Modvat credit on oxygen and acetylene gas used in oxy-acetylene flame/torch - Clarification regarding F. No. 261/72/12/87-CX.8 Dated 24-5-1988 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Admissibility of Modvat credit on oxygen and acetylene gas used in oxy-acetylene flame/torch - Clarification regarding. I am directed to say that doubts have been raised as to whether Modvat credit would be admissible on oxygen and acetylene used for removing runners and risers on the castings and for welding purposes. 2. The matter has been examined by the Board. Oxygen and acetylene gas is used with the help of cutting torch for cutting runners and risers on the castings and also for welding purposes. These gases are not actually used in the manufacture of finished goods. These are used as consumables in the cutting Torch and therefore these gases cannot be said to be used in or in relation to the manufacture of the finished product. It has therefore been decided that Modvat credit on oxygen and acetylene gas used exclusively for cutting runners and risers and for welding runners should not be admissible. 3. The practice of allowing Modvat on the said goods if being allowed in your Collectorates may be stopped forthwith. The remedial action for recovering the credit already allowed may also be taken. 4. The above instructions may be brought to the notice of the field formations. 5. Trade interests may also be informed suitably. 6. The receipt of this letter may please be acknowledged.