Capital goods credit for neoprene rubber sheets used in gasket manufacture was upheld under Rule 57Q.

Neoprene rubber sheets used in the manufacture of gaskets were treated as capital goods for credit under Rule 57Q because, on the facts, they were used in the manufacturing process and not merely received and used in the same form. The classification had already been accepted in the assessee's own case, and the Tribunal applied its earlier orders along with the Supreme Court's ratio on the scope of capital goods credit. Credit was therefore admissible, and the Revenue's appeal failed.

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Issues: Whether neoprene rubber sheets used in the manufacture of gaskets qualified as capital goods eligible for credit under Rule 57Q of the Central Excise Rules, 1944.

Analysis: The item had been found on facts to be used in the manufacture of the final product and not merely received and used in the same form. The classification of the item as capital goods had already been accepted in the assessee's own case, and the issue was covered by the Tribunal's earlier orders, including the ratio applied from the Supreme Court decision on the scope of capital goods credit.

Conclusion: The item was held to be capital goods eligible for credit, and the Revenue appeal failed.

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