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TMI Blog1995 (7) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... 1990 (30) ECR 67 CEGAT (SRB) wherein benefit of modvat credit on oxygen gas is allowed when oxygen is used for cutting purpose. The issue stands settled in terms of Central Excise Collectorate, Chandigarh T.N. No. 68-C.E./90, dated 19-7-1990 wherein modvat credit on oxygen, acetylene gases, used for cutting or welding purposes is permitted to be availed. In view thereof, I accept the appeal by setting aside the impugned order and by allowing consequential relief. The appeal is disposed of accordingly." 2. The facts in brief are that the respondents are engaged in the manufacture of ingots. They were availing modvat credit on inputs specified under Notification No. 177/86. The respondents filed a refund claim on account of the credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... JDR cited and relied upon the decision of the Tribunal in the case of M/s. Jai Bharat Steel Co. reported in 1990 (49) E.L.T. 527 and Collector of Central Excise v. Heavy Engineering Corporation Ltd. reported in 1990 (49) E.L.T. 531. Summing up his arguments, the ld. JDR submitted that oxygen was in the nature of tool and not in the nature of an input used in the manufacture of or in relation to the manufacture of ingots. He therefore, prayed that the appeal may be accepted. 4. No one appeared for the respondents. From the record, I find that the notice for today s hearing was issued to the respondents on 26-5-1995 They have neither presented themselves nor have they requested for adjournment of the case. As the case pertains to the year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated the acetylene gas as a consumable item used in relation to the manufacture of the final product casting" and since there is no bar in extension of Modvat credit in respect of consumable item, we allowed the same in respect of acetylene gas. The question would arise whether similar treatment could be meted out to oxygen gas used for breaking the ship. In the Modvat scheme, ship is specified as an input against the final product of scrap, obtained as a result of breaking of ship. Oxygen gas is admittedly used in relation to the breaking of this input namely, the ship and cannot be said to be used in or in relation to the manufacture of final product - namely scrap of various iron or steel items. Usage of oxygen gas along with the LPG th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd therefore the clarification contained in the Trade Notice will not be applicable to the present case. I also observe that [in] the Collector of Central Excise v. Ballarpur Industries Ltd., 1989 (43) E.L.T. 804 (SC) the Hon ble Supreme Court in para 7 held as under : 7. We also find no substance in the contention of Sri Ganguly that the process in which the sodium sulphate was used, was anterior to and at one stage removed from the actual manufacture of paper. Sri Sorabjee s answer to this contention is, in our view appropriate. That apart the following observations in Collector of Central Excise v. Eastend Paper Industries Ltd. cited by Sri Ganguly himself is a complete answer : ........ Where any particular process, this court fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ispute that it is essentially required in the manufacture of caustic soda lye and also in that view it is used in relation to the manufacture of caustic soda lye. Now the question for examination before me whether the oxygen is essentially required in the manufacture of ingots. A clear answer will be `No . 6. Having regard to the above decisions and the other evidence on record, I find that oxygen gas used for cutting bigger scrap pieces into smaller ones was not a part of the integrated process nor was it essentially required in the process of manufacture of ingots and therefore, it cannot be said that it was used in relation to the manufacture of ingots. Therefore, I hold that no modvat credit will be available to the respondents. 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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