Broad construction of input credit allows repair-and-maintenance items used in manufacturing to qualify for excise credit.

Credit under Rule 57Q of the Central Excise Rules, 1944 was held admissible where disputed goods were used in the manufacturing unit for repair and maintenance of plant and machinery. The Tribunal found that the denial of credit lacked specific reasoning for most items and could not stand after remand, which required a speaking order on eligibility. It further applied earlier rulings that welding electrodes, MS items and similar goods used for maintenance can qualify as inputs, and held that the word "include" in the definition of inputs requires a broad construction. The disallowance was therefore set aside and consequential relief followed.

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Issues: Whether credit was admissible on the disputed items as capital goods or inputs under Rule 57Q of the Central Excise Rules, 1944.

Analysis: The items were used in the manufacturing unit, including for repair and maintenance of plant and machinery. The remand required a speaking order on eligibility, yet the impugned order denied credit without any specific reasoning for most of the items. The Tribunal also relied on earlier decisions recognising that welding electrodes, MS items and similar goods used for repair and maintenance can qualify for credit, and on the principle that the expression "include" in the definition of inputs must receive a broad construction.

Conclusion: The credit on the disputed items was admissible and the disallowance was not justified.

Final Conclusion: The order disallowing credit was set aside and the appeal succeeded with consequential relief.

Ratio Decidendi: Where goods used in a manufacturing unit are shown to be employed as capital goods or as inputs, including for repair and maintenance of plant and machinery, credit cannot be denied by applying a restrictive construction to the definition of inputs.

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