9911796707
TMI Blog1994 (5) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... abrics can be treated as an input used in or in relation to the manufacture of the aforesaid product within the meaning of Explanation to Rule 57A(1) of the Central Excise Rules for the purpose of availing of MODVAT credit under the said Rule. The process in which the release paper is used has been set out in Order No. 304/1990 and it is reproduced below for the sake of appreciating the controversy. "The release paper is not exclusively of paper material alone. It is coated with silicon chemicals on one side of the paper. The PVC paste/plastisol is spread/coated on release paper (on the side of the silicon coating) at various stages. After necessary heating and cooling the cloth is laminated to the PVC coating. After passing the entire pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used in relation to the manufacture of the final product but the said authority has denied the benefit of the MODVAT credit on the ground that the release paper comes within the mischief of the excluded category of inputs mentioned in clauses (i) to (v) of the Explanation appended to Rule 57A. The sole reason given by the said authority is that the release paper acts as a carrier at certain stages of manufacture and, therefore, by inference it is in the nature of 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 in or in relation to the manufacture of the final product. We may note at this stage that the lower appellate author ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sary for us to look into the details of the arguments or the citation on this point. As regards the second question as to whether the material could be considered as an equipment or appliance we observe that the department has not produced any material to show that the silica coated release paper is considered as appliance or equipment either in the technical field or in the commercial parlance or both." He also draws attention to WRB's judgment in the case of M/s. National Leather Cloth Mfg. Co. Ltd. v. Collector of Central Excise, Bombay-II reported in 1994 (69) E.L.T. 612 (Tri.) (Order No. 1667-68/91/WRB, dated 26th August, 1991). We reproduce below paras 5 and 6 of the said judgment of WRB : * * * * ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in the process of manufacture of the final product and it is not by way of a post-manufacturing process as in the case of interleaving kraft paper that participation of the input takes place in the instant case. He, therefore, submits that the present case is on a far stronger footing than that of the interleaving kraft paper. He further points out that SRB's judgment in the case of Steel Authority of India Ltd., mentioned supra, was taken at a time when Supreme Court's judgments in the cases of Ballarpur Industries Ltd. [1989 (43) E.L.T. 804 (S.C.) = AIR 1990 S.C. 196) and Eastend Paper Industries Ltd. [1989 (43) E.L.T. 201 (S.C.)] had not been published. In view of the aforesaid submissions the learned Advocate Shri Arvind P. Datar sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the process of manufacture of the final product and part of the release paper is found in the final product itself. It cannot, therefore, be treated as a machine, machinery, plant, equipment, apparatus, tool or appliance used for producing or processing of any goods or for bringing about any change in any substance in or in relation to the manufacture of the final products. It would be observed from the list of articles enumerated in Explanation 1(i) of Rule 57A that all the articles are in the nature of things which merely help in producing or processing of any goods or for bringing about any change in any substance. Part of any such thing does not become part of the final product itself. As to the scope of the terms equipment, apparat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a weapon, esp. a gun (slang); anything necessary to the pursuit of a particular activity; Appliance : application; apparatus; WEBSTER'S NINTH NEW COLLEGIATE DICTIONARY : Equipment : the set of articles or physical resources serving to equip a person or thing : as (1) the implements used in an operation or activity; APPARATUS (2) all the fixed assets other than land and buildings of a business enterprise; b. a piece of such equipment; Apparatus : a set of materials or equipment designed for a particular use; an instrument or appliance designed for a specific operation; a group of bodily parts and esp. organs having a common funct ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
