Modvat credit on structural materials used to fabricate chimney and storage tanks was held inadmissible as capital goods.

Modvat credit on plain plates and rock wool used as construction material for fabrication of a chimney and storage tanks was not admissible as capital goods under Rule 57Q. The materials were treated as structural inputs, and prior Tribunal decisions had already held plates and angles used for similar fabrication to be ineligible for credit. On that reasoning, the items could not be classified as capital goods for Modvat purposes, and the credit claim failed.

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Issues: Whether Modvat credit on plain plates and rock wool used for fabrication of chimney and storage tanks was admissible as capital goods under Rule 57Q of the Central Excise Rules, 1944.

Analysis: The items in question were used as construction material for fabrication of chimney and storage tanks. Credit on structural materials such as plates and angles had already been held to be inadmissible in prior Tribunal decisions. On that reasoning, the materials used for fabrication of the chimney and storage tanks could not qualify for Modvat credit as capital goods.

Conclusion: Modvat credit on the plain plates and rock wool was not admissible.

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