COMMISSIONER OF CENTRAL EXCISE Vs. DCW LTD.

JUDGEMENT

(1.) THESE appeals of the Revenue are directed against the grant, by the lower appellate authority, of Modvat credit to the respondents on various items of capital goods under Rule 57Q of the Central Excise Rules, 1944 for the period March 1994 to April 1996. Rule 57Q allowed credit of specified duty paid on the capital goods used by the manufacturer in his factory and enabled him to utilise the credit towards the payment of duty of excise leviable on his final products. During the aforesaid period, the term "capital goods" had the following meaning [vide Explanation 1 to sub -rule (1) of Rule 57Q]: Explanation : - For the purposes of this section, -

(2.) APPEAL No. E/141/99 is against grant of capital goods credit in respect of the following 24 items : -

(3.) APPEAL No. E/142/99 is against grant of capital goods credit on the following 5 items : - (1) 11 kv - 250 mva outgoing panel (2) 11 kv - 250 mva incoming panel (3) Generator excitation transformer panel (4) VCM bullet (5) Mineral insulated rtd. Insert Most of these items were used as "accessories" of DC. sets in the captive power plant in the respondents' factory and, therefore, these items qualify to be eligible for capital goods credit in terms of Clause (b) of Explanation 1 ibid. In respect of Items 1, 2 and 3, Id. Counsel has cited decisions holding the goods to be eligible for Modvat credit under Rule 57Q. It appears from the records that Item No. 4 (VCM bullet) was used as container for transportation of input to the factory. Admittedly, the item was not used in the factory. Therefore, the benefit of Modvat credit would not be available for "VCM bullet" under Rule 57Q. The 5th item mentioned above was also used in captive power plant and the same was also covered by the definition of "capital goods" under Explanation I ibid. In the result, Appeal No. 142/99 is allowed only to the extent of denying capital goods credit in respect of 'VCM bullet'. Appeal is dismissed as regards as all the other items of capital goods.