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TMI Blog1992 (8) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... of manufacture of Plywood. The original authority had denied the benefit of MODVAT credit holding that the Sand Paper works as a tool/apparatus/machinery and as such it cannote be treated as a consumable item as input. The learned Collector (Appeals) taking note of the respondents' plea that the Sand Paper used to smoothen the surface of plywood and during the process of sanding, the Sand Paper gets consumed and also that it is used to smoothen patches on plywood by hand, has observed that judging from the process of manufacture involved and the role played by the Sand Paper it can definitely be said that the Sand Paper is an input used in or in relation to the manufacture of plywood. 2. The learned Departmental Representative pleaded tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime. He further pleaded that the term "in or in relation to the manufacture" has to be given a wider meaning and has pleaded that this Tribunal in the case of Travancore Cochin Chemicals Ltd. v. C.C.E. 1990 (50) E.L.T. 172 (Tribunal) has allowed the benefit of Modvat credit in respect of Titanium metal Anodes used in the manufacture of Caustic Soda. 4. We observe that the short point that falls for our consideration is whether the Sand Paper used could be taken to be a part of the sanding machines and could be considered as a tool in the context of its use in the respondents' factory. In the 'Materials Handbook' by George S. Brady and Henry R. Clauser, Eleventh Edition, published by McGraw-Hill Book Company, 'Sandpaper' has been described ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss control can be adjusted with great accuracy. Each roller is covered with felt which acts as a cushion between roller and abrasive paper; the latter is spirally wound over the periphery of the roller and must be carefully adjusted. The first roll carries the roughest paper, the second a finer one and the last a finishing grade." From the above it is seen that the Sand Paper is mounted on the drums and it works on the wood. The Sanders become functional only by the mounting of the Sand Paper on the drums. The Sand Paper has to be taken as an accessory to the machine to make it functional for the purpose of bringing about the required finish on the plywood. In the case of Andhra Pradesh Paper Mills Ltd. v. C.C.E. ,Guntur, in Order No. 299/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e scheme of MODVAT if the parts of the machines are included there is no reason why the lighting equipment and other structural fittings which are used in the factory in which the goods are produced would not have to be allowed the benefit of the input duty relief under the MODVAT scheme. Going by the ratio of the judgment of the Hon'ble Supreme Court cited supra, it has to be concluded that the credit has to be allowed only in respect of such of those inputs which are used in the process of manufacture and which go directly into the manufacturing stream by themselves or are used in the manufacture of materials which go into the manufacturing stream resulting in the manufacture of the end-product." In the present case the use of Sand Paper ..... X X X X Extracts X X X X X X X X Extracts X X X X
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