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TMI Blog2013 (8) TMI 501X X X X Extracts X X X X X X X X Extracts X X X X ..... actory - When even the Asstt. Commissioner of Central Excise admitted that these goods were used in the machine - Held that:- The items in the present case were not falling within the meaning of capital goods as defined in explanation to Rule 57Q of the Central Excise Rules, 1944. COMMISSIONER OF C. EX., COIMBATORE Versus JAWAHAR MILLS LTD. [2001 (7) TMI 118 - SUPREME COURT OF INDIA] and COMMISSIONER OF C. EX., COIMBATORE Versus JAWAHAR MILLS LTD [2001 (7) TMI 118 - SUPREME COURT OF INDIA] was on the user test, which was in respect of goods in fabrication of chimney was an integral part of the diesel generating plant. The goods in the present case do not fall within the meaning of Explanation 1(a) of Rule 58Q. We also find that Expla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt and accessories of the capital goods installed in the factory. When even the Asstt. Commissioner of Central Excise admitted that these goods are used in the machine? 3. The appellant-assessee claimed Modvat-credit on the HR/MS/GC sheets/plates/angles/channels/supporting structure etc., used mainly in boiler/centrifugal machine/crystaliser/juice heater as an accessory components of these machines, for making shades and fabrication of various items including staging/supporting structure and repair of the plants of the goods. The Appellate Authorities confirmed the order of the Adjudicating Officer on the ground as follows :- The appellant has intimated that HR/MS/GC sheets/plates/angles/channels/supporting structure etc., are used ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods . There is a clear cut distinction between the raw material of capital goods and parts/components thereof e.g. Steel is the raw material of bus being the constitution of its body but it is not the parts/components thereof. The piston, gear box, break shoes etc. are the components/parts of the bus but these are not the raw material of bus. Component/parts is a complete goods in itself and ready to use without requiring any further processing. Considering the nature and general application of the disputed items, it is observed that these cannot be used as such as a components/parts. As such these can be a raw material of the capital goods but not the components/spares thereof. In terms of Rule 57Q, a component, parts, spares of the mac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oods is said to be capital goods , it was held in para 13 as follows :- 13. Applying the user test on the facts in hand, we have no hesitation in holding that the steel plates and M.S. Channels, used in the fabrication of chimney would fall within the ambit of capital goods as contemplated in Rule 57Q. It is not the case of the Revenue that both these items are not required to be used in the fabrication of chimney, which is an integral part of the diesel generating set, particularly when the Pollution Control laws make it mandatory that all plants which emit effluents should be so equipped with apparatus which can reduce or get rid of the effluent gases. Therefore, any equipment used for the said purpose has to be treated as an acce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise Rules, 1944. Rule 57Q is quoted below :- 57Q. Applicability. - (1) The provisions of this section shall apply to finished excisable goods of the description specified in the Annexure below (hereinafter referred to as the final products ) for the purpose of allowing credit of specified duty paid on the Capital goods used by the manufacturer in his factory and for utilizing the credit so allowed towards payment of duty of excise leviable in the final products, or as the case may be, on such capital goods, if such capital goods have been permitted to be cleaned under rule 57S, subject to the provisions of the section and the conditions and restrictions as the Central Government may specify in this behalf : Provided that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lanation 1(b) of Rule 58Q is not attracted to the goods in the present case inasmuch as capital goods in Explanation 1(b) includes components, spare parts and accessories of the aforesaid machines, machinery, plant, equipment, apparatus, tools or applicants used for aforesaid purpose. The words aforesaid used in Explanation 1(b) refer to the capital goods included in Explanation 1(a), namely, machines, machinery, plant, equipment, apparatus, tools or appliances used for producing or processing of any goods or for bringing about any change in any substance for the manufacture of final products. 10. In the present case, the foods in question are neither used for producing nor for processing of any goods or bringing about any change in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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