Modvat credit eligibility for endless felts used in asbestos pipe manufacture upheld under Rule 57A, not treated as machinery items.

Endless felts used in the manufacture of asbestos pipes were treated as eligible Modvat inputs under Rule 57A of the Central Excise Rules, 1944, because earlier Tribunal decisions had already held that felt and similar materials used in the manufacturing process qualify for such credit. The Tribunal applied those precedents to the goods in issue and held that the question was no longer res integra. The Revenue's contention that the felts were machinery items outside Rule 57A and, if relevant at all, covered only by Rule 57Q, was rejected; the claim to credit under Rule 57A was accepted.

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Issues: Whether endless felts used in the manufacture of asbestos pipes were eligible inputs for Modvat credit under Rule 57A of the Central Excise Rules, 1944, or whether they were machinery items falling outside that provision and, if at all, covered only under Rule 57Q.

Analysis: The issue was treated as already settled by earlier Tribunal decisions holding that felt and similar materials used in the manufacturing process are eligible inputs for Modvat credit under Rule 57A. The Tribunal found that those decisions squarely applied to the present goods and that the dispute was no longer res integra.

Conclusion: The claim of eligibility under Rule 57A was accepted and the Revenue's contention that the items were excluded machinery items was rejected.

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