Rule 56A credit denied for kiln car tiles and bars used in firing, not as manufacturing inputs.

Rule 56A credit under the Central Excise Rules, 1944 is confined to materials, component parts and raw materials used in the manufacture of notified excisable goods. Silicon carbide tiles and silicon bars used in kiln cars to fire insulators were treated as parts of the kiln car arrangement, not as inputs going into the manufacture of the insulators themselves. Because they functioned as removable support and flooring during firing rather than as raw material or component part of the finished product, they fell outside the concessional scope of the rule. Credit was therefore not available.

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Issues: Whether silicon carbide tiles and silicon bars used in kiln cars for firing insulators qualified as materials or component parts used in the manufacture of excisable goods so as to attract the benefit of Rule 56A of the Central Excise Rules, 1944.

Analysis: Rule 56A grants credit in respect of materials and component parts used in the manufacture of notified excisable goods, and the expression material in that setting is to be read in association with component part and the reference to raw material in the rule. On the facts, the tiles and bars were not themselves materials going into the manufacture of insulators. They formed part of the kiln car arrangement, serving as floor and support during firing, and were more akin to removable parts of the trolley itself than to raw materials or component parts of the finished product. A wide reading of material to include any item used in the manufacturing process would extend the concession beyond its intended scope.

Conclusion: The items did not qualify for the benefit of Rule 56A and the authorities below were in denying credit.

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