Modvat credit on plant items allowed for manufacturing use, including vessels, membrane modules, cathodes and cable trays.

Modvat credit under Rule 57Q was treated as admissible for several disputed items used in manufacture, including a solution vessel, cylindrical vertical tank, membrane modules, primary nickel cathodes and cable trays. The solution vessel and cylindrical vertical tank were covered by earlier tribunal precedent allowing capital goods credit. Membrane modules were eligible because goods falling under Heading 84.21 were expressly within the rule and they were used for filtering chemicals in the manufacturing process. Primary nickel cathodes were recognised as part of the reaction process, and cable trays were covered by Supreme Court precedent. Credit was therefore allowed on all contested items.

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Issues: Whether Modvat credit under Rule 57Q was admissible on the disputed items of solution vessel, cylindrical vertical tank, membrane modules, primary nickel cathodes and cable trays.

Analysis: The disputed goods were examined as capital goods used in the manufacturing process. The solution vessel and cylindrical vertical tank were covered by earlier tribunal precedent allowing credit under Rule 57Q. The membrane modules were treated as eligible because the rule expressly included goods falling under Heading 84.21 and they were used for filtering chemicals in manufacture. Primary nickel cathodes were accepted as used in the reaction process of manufacture. Cable trays were held admissible by the Supreme Court in Jawahar Mills.

Conclusion: Modvat credit under Rule 57Q was admissible on all the contested items, and the claim succeeded.

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