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TMI Blog1994 (11) TMI 250X X X X Extracts X X X X X X X X Extracts X X X X ..... as below : 2.2. The respondents are engaged in the manufacture of Rubber processing chemicals, for the manufacture of which, they bring in duty paid Mafron/Freon gas and claim Modvat Credit in respect of duty paid on these two items. Their contention that these two items are inputs used in or in relation to the manufacture of Rubber processing chemicals was rejected by the department. The ground taken by the Department was that they are refrigerent gases and they are meant for the functional operation of the refrigerating plant, hence they cannot be said to be used in or in relation to the manufacture of the final product. This issue came in appeal before us. 2.3. We held the issue in the appeal filed by the respondents in their favour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder provisions of Rule 57A of the Central Excise Rules, 1944? 3. Shri K.P. Misra urges, pleading that the questions involve consideration of mixed questions of facts and law and hence would call for reference. He pleads that refrigerent gases cannot be treated as consumables. Their purpose is only for use in the chilling plant and they go in only for functioning of the machine. These gases cannot be compared to the inflamable gases like oxygen/acetylene gases, which are consumed instanteneously through medium of flame torch. Here these gases form part of the refrigerating machine as a chilling media. In the case of domestic refrigerators such gases are put up duly sealed and form part of the refrigerator. Here the plant for refrigeration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the plant as refrigerents is necessary. In that manner, even if these gases are construed as going with the function of the plant, there is no denial that circulation of these gases is necessary for keeping Monoethylene glycol at the required level of temperature to produce the proper chemical reaction enabling crystalisation and production of the right quality final product. Hence, these gases are used in the process of manufacture of final product as an input, required for enabling chemical reaction to take place. The same position was noticed by us in the case of nitrogen gas brought in for creating a chilling and inert atmosphere for enabling proper chemical reaction to produce the final product [vide our decision in Kopran Ltd. 1993 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... temperature to effect chemical reaction. It may be used more than once in circulation; all the same it remains a consumable gas. It is not the frequency of use or the rapidity of consumption that could be the relevant factor for judging the question as to whether it is consumable or not. So long as it is clear that it is a gas brought in cylinders for replacement periodically once a week or fortnight, it is a consumable input. Merely because it is used more than once, it cannot become a part of the equipment or equipment by itself. Thus both acetylene gas considered earlier and refrigerent gas in this case are akin in their usage and there is no scope for making a distinction. Hence such gas cannot be said to be hit by exclusion clause in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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