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TMI Blog2000 (3) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... the coke which makes the iron ore into molten metal. Electric supply for the entire operation is made through cables. The transformers are used for voltage variation. The plant is integrated and controlled by electrical panels and computer assisted programmes control the apparatus. Devices to monitor the temperature are used. Cooling towers are also used. The molten metal is taken out and is collected in ladles. These ladles are carried by ladles crane to the pig casting machine. The operation of the crane is with the help of gear box and steel wire ropes. The molten metal in the furnace is periodically tapped by drilling a hole which is later plugged with mud gun. Lathe and milling machines are used for repairing machinery. The factory runs on continuous process basis round the clock. 2.Assessee had brought in machines, equipments, components etc. on which modvat credit had been taken by them in terms of Rule 57Q of the Central Excise Rules. Six show cause notices were issued alleging that modvat credit was wrongly taken, that such credit was required to be reversed and that the assessees were liable to penalty. The Commissioner in the single order disallowed the credit amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cipate in the production of final goods. On this ground, he pleaded that the insistence on direct use was futile. 10. On examination, we find the definition to be an extensive one. The wording "plant" as well as "equipment" have been defined in several judgments. The Tribunal in the cited judgment in the case of Jawahar Mills Ltd. [1999 (108) E.L.T. 47 (Tri.)] had referred to the definition of "plant" in paragraph 32 thereof as "whatever apparatus is used for business or production". The Tribunal in the judgment relying upon the Supreme Court judgment in the case of Indian Copper Corporation Ltd. and J.K. Cotton Spinning Weaving Mills Co. Ltd. held that direct participation was not necessary for the equipment etc. to be eligible for the benefit. In a number of other judgments cited, the Tribunal had permitted a number of items as eligible under the said Rule. We refer to those judgments which related to wires, cables, capacitors, electric panels etc. [1997 (96) E.L.T. 354 - Grasim Cement] which are in the nature of auxiliary equipments and do not directly hit the production. 11.Tested on these judgments cited, the various disputed items would stand benefited. We, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower supply would not be effective or optimum and resultantly, the machinery designed for production or process of goods would not function. But the EPBAX enables large number of persons to communicate. It is not designed for the conversation between the two persons. If only furnace operator was to be advised, a closed communication system would be more effective. We find that EPBAX is a general communication devise and cannot be called to be an equipment used for producing or processing excisable goods. We uphold the orders of the Commissioner in this regard. 15.Duty amounting to Rs. 5,87,000/- has been denied on the crane on the ground that the duty paying documents were not made available. Shri Shroff submitted that the documents are now available. He submits that it is a rectifiable error which may be permitted to be rectified. We accept this plea and would remand the issue back to the Commissioner for reconsideration. 16.The next item is lighting fittings where the duty involved is Rs. 1,63,274. The claim made in their respect is that in the absence of illumination, the work could not go on. This is a far-fetched argument. In the discussion earlier, we had held that an i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he angles, channels etc. which were component parts for the manufacture of certain goods which goods in turn would be used for producing or processing of any goods, may would qualify under the definition. It is his further submission that it is not necessary that such inputs be used for the manufacture of dutiable capital goods. On perusal of the definition of capital goods as it existed at the time of receipt of the inputs, we have to accept the contention that angles, channels etc. being components were permissible inputs. This has been so held in the Single Member judgment in the case of Nova Udyog Ltd. [1996 (88) E.L.T. 532]. Explanation to Rule as it then stood gave a very wide definition to the phrase "capital goods" including therein terms such as "plant" "equipment", which at best, are not capable of being specifically defined. The phrase had come in scrutiny in the Tribunal judgment in the case of Vivek Alloys [1998 (98) E.L.T. 156]. The Tribunal in relation to this phrase used in Rule 57Q defined plant as "machine or groups of machines fitted in a particular manner for manufacture of a particular product." The Tribunal proceeded to deny the benefit to steel, rounds, angle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Apex Court was dealing with buildings constructed for housing the factory in which the machinery is installed while in the instant case the question before the Tribunal was in relation to cement and structurals used in the erection to blast furnace itself and not to house the blast furnace. Heard the submissions. 'Capital goods' have been defined in the Explanation to Rule 57Q to mean, "machine, machinery, plant, equipment etc. used for producing or processing of any goods or for bringing out any change in any substance in the manufacture of the final product". The question presently raised is whether cement and steel structurals used for erecting blast furnace in the factory of the applicant for producing pig iron can come within the meaning of 'capital goods' under Rule 57Q. There can be no dispute about blast furnace as such being considered a machine/machinery used for producing or processing of the goods. However, it is a different matter to suggest that material used for erecting blast furnace will also qualify to be considered capital goods. The process by which blast furnace is erected is a process anterior to the coming into existence of the blast furnace u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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