9911796707
TMI Blog2003 (11) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Customs and Central Excise (Appeals), Trichy by which the Commissioner has held that the assessees are eligible for the Modvat credit in respect of capital goods used in textile mills and during the course of manufacture of final product which is chargeable to duty, intermediate product such as combed/ carded cotton, also known as "Sliver" also emerges which is exempt from duty. Similar order has been passed by another Commissioner (Appeals) vide Order-in-Appeal No. 106/2002 (CBE) (GVN), dated 30-4-2002 allowing the appeal of the assessee in respect of inputs viz. Viscose Stable Fibre which is used in the manufacture of cotton carded/combed. 3. All the other six appeals have been filed by different assessees against the indepe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are classified under Heading 52.02 and the goods falling under this heading was not specified as eligible items under Rule 57Q till 21-10-94. Therefore, the Modvat credit taken on the capital goods which were procured prior to 21-10-94 is not admissible. 5. Heard Shri Ranganathan, learned Counsel for M/s. Sudarsanam Spinning Mills & M/s. Sri Vishnu Sankar Mills Ltd., Shri N. Venkataraman, learned Counsel for M/s. Kandagiri Spinning Mills, M/s. Sree Rajendra Mills Ltd & Sambandar Spinning Mills, Shri Balagopal, learned Counsel for M/s. Pongalur Pioneer Textiles Mills, Shri Suresh, learned Counsel for Shri Skanda Spinners and Shri Mohd. Shafi, learned Counsel for M/s. Kaveri Yarns and Fabrics Ltd. 6. Shri S. Ranganathan, learned Counsel su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p; Modi Crafts Limited v. UOI reported in 1997 (91) E.L.T. 285 (Del.) wherein it was held that Sliver or Carded Gilled Sliver coming into existence at an intermediate stage is not marketable having no identifiable personality and no shelf life being of transient character and sliver not to be considered as goods so as to attract levy in terms of Section 2(d) of the C.E. Act, 1944. The appeal filed by the UOI against this judgment was dismissed by the Apex Court as reported in 1996 (81) E.L.T. A47 (S.C.). 7. All other Advocates referred to the respective grounds of appeal and made submissions on the lines of the submissions made by Shri S. Ranganathan, Advocate. 8. We have carefully considered the submissions made by both the sides. The on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r generation of electricity will not be entitled to Modvat credit. Rule 57R(2) makes it clear that intermediate products have come into existence, cannot be a reason to vary or deny benefit of Modvat credit on the capital goods, provided the final product is dutiable. In the instant case admittedly the final products viz. cotton yarn is chargeable to duty. In the background of the fact that intermediate products did emerge and emergence of such intermediate product cannot vary or deny the benefit of credit in respect of the capital goods, as provided for under Rule 57R(2), just because such intermediate products have been included on a later date, cannot lead to a conclusion that prior to the date of inclusion, the benefit of credit cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X
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