2010 (3) TMI 829

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..... that:- respondent is entitled to claim MODVAT credit with regard to the secondary packing materials. it is not that all packing material could be considered for the purpose of MODVAT credit as an input and we clarify that keeping in mind the nature of the product in the instant case, i.e. Biscuits, the relief granted to the respondent by the Tribunal, is just and proper, Appeal is accordingly dismissed.
K.L. Manjunath and B.V. Nagarathna, JJ. Shri N.R. Bhaskar, Advocate, for the Appellant. Shri G.B. Shastry, Advocate, for the Respondent. [Judgment per : B.V. Nagarathna, J.]. - The revenue has filed this appeal, challenging the order dated 15th December 2005 made in final order No. 2080/2005 [2006 (205) E.L.T. 669 (Tri. - Bang.)] by .....

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..... missioner, after hearing, passed an order, stating that, the said goods were not part of the secondary packing material and that the deduction claimed for the said material as inputs could not be allowed under Rule 57-A of the said Rules. Accordingly he disallowed the credit to an extent of Rs. 1,74,934/-. Against the order of the Deputy Commissioner, an appeal was preferred by the assessee before the Commissioner, which authority confirmed the order of the Deputy Commissioner. Being aggrieved by the said order, the respondent preferred the appeal before the Tribunal. The Tribunal, however, reversed the order of the Commissioner and granted the relief to the respondent. The said order is in challenge in this appeal, raising the aforesaid su .....

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..... It is necessary to keep in mind, the nature of product. The product is such an eatable, which would ultimately lose its quality and taste, if not preserved by adequate packaging. Therefore, it requires a particular nature of packing in order to preserve its quality, the packing material in respect of which, MODVAT credit is claimed, is a necessary item which would fall within the scope of provisions of Rule 57-A of the Rules. Therefore, the Tribunal was justified in holding that the assessee would be entitled to claim MODVAT credit on the value of the said products. We find that the Tribunal was justified in granting the relief by considering the fact that the product in question is such that, it requires to be packed in a particular manne .....

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