Cenvat credit on manufacturing inputs allowed where goods were used in production and not treated as capital goods.

Summi cream cement/Summi cement used in the manufacture of colour picture tubes were not accepted as capital goods or as spares, components or accessories of capital goods, but their admitted use in the manufacturing process brought them within the scope of inputs used in relation to manufacture. On that basis, Cenvat credit was held maintainable on the facts, and the departmental appeal failed.

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Issues: Whether Summi cream cement/Summi cement used in the manufacture of colour picture tubes were eligible for Cenvat credit as inputs.

Analysis: The goods were not accepted as capital goods or as spares, components or accessories of capital goods. The use of the goods in the manufacturing process was admitted, and on that basis they were held to qualify as inputs used in relation to manufacture. The credit was therefore maintainable on the facts of the case, and no reason was found to interfere with the order allowing credit.

Conclusion: The goods were eligible for Cenvat credit as inputs, and the departmental appeal failed.

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