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TMI Blog1997 (9) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... items taken up for arguments before us are listed in the technical submissions and orders are being passed only in respect of these items because other items were not pressed before us. We are dealing with these items as below. 3. It was contended by the appellants that the manufacturing process of cement involves crushing of coal in the coal grinding mill, transporting the crushed coal to kiln for burning; that similarly raw meal which is also in crushed form has to be transferred to the Raw Meal Silos and from there to the kiln for calcination. Finally cement which is manufactured in the cement mill has to be transported to the silos where it is stored and bagged. 4. For appreciation of evidence, the requirement of law is necessary. Therefore, explanation given under Rule 57Q is reproduced hereunder : "(1) 'Capital Goods' means - (a) Machines, machinery, plant, equipment, apparatus, tools or appliances used for producing or processing of any goods or for bringing out any change in any substance for the manufacture of final products; (b) Components, spare parts and accessories of the aforesaid machines, machinery, plant, equipment, apparatus, tools o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, they will be eligible for Modvat credit. (iii) Fire-Bricks / Fire-Crete /S.S. Casting. Fire-bricks and fire-cretes are refractory material used for lining the kiln. S.S. Casting are also used for lining the kiln. The ld. Counsel submits that this Tribunal has been consistently holding that refractory bricks are goods eligible for Modvat credit. The ld. Counsel cited and relied on the decision of this Tribunal in the case of M/s. Rathi Ispat Limited reported in 1997 (93) E.L.T. 532. The ld. SDR submitted that refractory material is not used for producing / processing of cement and, therefore, it cannot be eligible for the benefit of Modvat credit. After careful consideration of the submissions made, we find that these items were fully covered by the decision of this Tribunal in the case of M/s. Rathi Ispat Limited cited and relied upon by the appellants. Following the ratio of this decision, we hold that Fire-bricks, Fire-cretes and SS Castings shall be admissible for Modvat credit. (iv) Thermo Couple. It was submitted before us that Thermo couples of various kinds are used in various places in the plant to measure the temperature. It was also submitted that thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, we find that these valves are used for controlling the various materials which go into the production of cement. They are in the nature of control equipment which are essential for processing or production of cement. Looking to the function of the valves, we hold that they are used in the processing of cement. We, therefore, hold that solenoid and needle valves are capital goods and will, therefore, be eligible for the benefit of Modvat credit. (vii) Air/Water/Oil Filters. According to the ld. Counsel for the appellants, these filters are used at various places in the plant to ensure filtration of air / water / oil etc. to meet the process parameters. We note that air, water and oil are required for producing / processing of cement. Filtering of these items is essential before they are used. We, therefore, hold that they are capital goods and will be eligible for Modvat credit. (viii) Wires and Cables. The ld. Counsel submits that wires and cables are essential parts of the plant without which the plant cannot function at all that these are used for transmission of electricity and electrical signals to the machines, motors and all electrically operated instrument ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is being packed. The Department, countering the arguments of the ld. Counsel, submitted that chains are general utility items and are not made only for the manufacture/processing of cement and, therefore, cannot be termed as capital goods. Looking to the submissions and function of chain, we find that chains are part of plant and machinery for manufacture of cement. Having regard to their specific function, we have no doubt in holding that they are capital goods and hence Modvat credit will be admissible on chains used inside the factory. (xi) Lifting Liner/Plate Describing the function of these items, the ld. Counsel submitted that lifting liner/plate are parts of coal mill where crushing of coal takes place; that the coal mill and the grinding media inside the mill crushes the coal; that the liners and plates are installed inside the coal mills that these have a dual function; that they protect the steel shell of the mill from damage which can be caused by the heavy grinding media; that may help improve the efficiency of the grinding media by not allowing grinding media to roll inside the drum but to get the same lifted upto a particular height and then allowing it to fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich it cannot function. From the above function, we note that shaft for supply of primary air through a fan, known as shaft for P.A. Fan is essentially required for helping manufacture/processing of cement. We, therefore, hold that it is capital goods for the purpose of manufacture/processing of cement and, therefore, will be eligible for the benefit of Modvat credit. (xv) Ram Packing Tooth Point for Pool. It was contended that the ld. Commissioner in his Order No. 23/CG/94/Commr., dated 17/18-7-1995 allowed this item but it inadvertently has been left out to be included under Sl. No. 43 of show cause notice under reference for September period. Therefore, Modvat credit for a sum of Rs. 1064/- is clearly allowable. Since the Department has not agitated the order of the ld. Commissioner allowing the benefit of Modvat credit on this item, we hold Modvat credit will be admissible on this item. (xvi) Conveyor Belts/Parts/Rollers/Belts. The ld. Counsel contended that the entire process of manufacture of cement involves transportation of material from one point to another; that this involves transportation of limestone before crusing and various other minerals which are sti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit. (xx) Pressure Measuring Instrument. Narrating the function of this item, the ld. Counsel for the appellant, submitted that in order to ensure that there is no obstruction in the pipelines and in order to measure the quantity passing through the pipelines, pressure measuring devices are used at various stages in the pipeline. We note that this Tribunal had, in the case of Geep Industrial Syndicate v. C.C.E., reported in 1996 (88) E.L.T. 753 examined the question of admissibility of Modvat credit on measuring and testing equipment. We find that pressure measuring instrument is a measuring equipment. The Tribunal in this case held that measuring and testing equipment will be eligible for Modvat credit. We agree with this decision of the Tribunal and hold that Modvat credit will be admissible on pressure measuring instrument as capital goods. (xxi) Junction Box. It was argued before us that junction box is a protection device for the electrical and other equipment of the plant for safety and to avoid the chance of fire. We hold that, looking to the function of the junction box, junction boxes installed in the factory will be eligible for the benefit of Modvat cre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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