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TMI Blog1990 (2) TMI 195X X X X Extracts X X X X X X X X Extracts X X X X ..... f disposal of this appeal can be stated as below. 3. The respondents are the manufacturers of decorative laminate sheets falling under Heading 39 of the Central Excise Tariff. They were receiving duty paid BOPP films classifiable under sub-heading 3902.31 for use in the manufacture of laminated sheets. They had availed of credit of duty paid on these films, since both the final product and the input were notified under the MODVAT scheme. The department objected to the availment of the credit of the duty paid on these films used in the manufacture of laminated sheets on the ground that these films act as separators, while putting the sheets into the press and do not constitute as an input in the manufacturing process. These films prevent tw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtment, explained the process of manufacture and also indicated as to how these films are used in relation to the manufacture of the final product - decorative laminates. 6. Shri A. Hidayatullah, the learned advocate also showed the samples of the films before use and also after their use and indicated that these films after use cannot be again used for the same purpose of lamination but can be used as packing material and in fact they are using these as packing material for the upper surface of the laminates. 7. Shri K.M. Mondal, the learned SDR, after explaining the process of manufacture and the use of the inputs in the said process indicated that the films do not form part of the final product and they only function as a separating me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibed in Sec. 11A of the Act. 8. After hearing Shri K.M. Mondal, the learned SDR, we did not call upon the learned advocate Shri A. Hidayatullah to argue. 9. We find that in this case, as seen from the order of the Assistant Collector, he has admitted that these films were given proforma credit under Rule 56A of the Rules, where the requirement is that the inputs should be used as materials or components. This benefit was allowed under the order of the Collector (Appeals) against which no appeal has been filed by the department. The MODVAT scheme does not make any such stipulation. Rule 57A lays down the requirement of the use of inputs in or in relation to the manufacture of the final product. The only bar is that the items so used should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s identity completely and becomes akin to a translucent paper. Hence we are convinced that these films get partly consumed in the process of manufacture of lamination sheets and lose their identity. They directly go in the process of lamination. Though, no doubt, they are retrieved and do not form part of the final product, they lose their identity. We do not subscribe to the view that for availing MODVAT scheme the input should form part of the final product because MODVAT scheme extends even to packing materials and the requirement is only that the inputs should be used in or in relation to the manufacture of the final product. In view of these considerations, we find that the order of the Collector (Appeals) does not call for any interfe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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