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TMI Blog2002 (3) TMI 789X X X X Extracts X X X X X X X X Extracts X X X X ..... In this case the assessee Lakshmi Machine Work Unit II, Kaniyur, Coimbatore is carrying on the business of manufacturing textile machinery and parts falling under Chapter 84 of CETA. They are availing Modvat credit under Rule 57Q of the C.E. Rules for an amount of Rs. 6,18,539/- representing the value of Dimensional Universal Machine and Digital Height Gauge. The assessee claimed Modvat credit in terms of Rule 57Q. The Department felt as it noticed that these items do not qualify as capital goods as they do not fall under the purview of capital goods. The Department issued two show cause notices (1), dated 23-6-1995 and (2) dated 24-7-1995 which are extracted below : 1. Show Cause Notice dated 23-6-95 Whereas it appears that M/s. Laksh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken in respect of the items (a) Dimensional Universal Measuring Machine and (b) Digital Height Gauge amounting to Rs. 6,18,539/- should not be disallowed in accordance with Rule 57U of the C.E. Rules, 1944. M/s. Lakshmi Machine Works Ltd. Unit-II, Kaniyur should also produce at the time of showing cause all the evidences upon which they intend to rely in support of their defence. They should also indicate in their written reply explanation as to whether they wish to be heard in person before the case is adjudicated. If no cause is shown against the action proposed to be taken within 30 days of receipt of this notice of having shown cause if they fail to appear before the adjudicating authority when the case is posted for hearing, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pital goods. M/s. Lakshmi Machine Works Ltd. Unit-II, Kaniyur should also produce at the time of showing cause all the evidences upon which they intend to rely in support of their defence. They should also indicate in their written reply explanation as to whether they wish to be heard in person before the case is adjudicated. If no cause is shown against the action proposed to be taken within 30 days of receipt of this notice of having shown cause if they fail to appear before the adjudicating authority when the case is posted for hearing, the case will be decided ex parte. Sd/- Superintendent of Central Excise 3. The assessee in their letters dated 17-7-1995 and 16-8-1995 state which has been referred to the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be manufactured and marketed by the appellants. The above view is also supported by the ruling of the Supreme Court in the case of Rajasthan Chemicals reported in 1991 (55) E.L.T. 444 (S.C.). The Assistant Commissioner s order rejecting the Modvat credit under Rule 57Q to the subject items cannot, therefore, sustained and has to be vacated. 4. The orders passed by the Commissioner (Appeals) are enclosed. Against that order two appeals were filed by the Department and in the appeal Single Member of the Tribunal following the judgment of various Tribunal including CCE v. Shanthi Synthetics as reported in 1998 (97) E.L.T. 533 dismissed the appeal of the Department. The Department filed a petition before Hon ble High Court of Madras whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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