Modvat credit for manufacturing inputs upheld where parts were not complete machinery or equipment under Rule 57A.

Modvat credit under Rule 57A was admissible for thermo-couple tips, mini tips and clay graphite stoppers because the exclusion from "input" applied only to complete machines, machinery, plant, equipment, apparatus, tools or appliances, not to every part thereof. Thermo-couple tips had already been accepted as eligible inputs, mini tips were reasonably covered by the declaration filed for thermo-couple tips, and clay graphite stoppers were not shown to be complete machinery or equipment. The items were therefore treated as declared inputs used in or in relation to manufacture, and credit was allowed.

---

---

Issues: Whether thermo-couple tips, mini tips and clay graphite stoppers were eligible inputs for Modvat credit under Rule 57A and were covered by the declaration filed by the assessee.

Analysis: The exclusion in the definition of input under Rule 57A was confined to machines, machinery, plant, equipment, apparatus, tools or appliances used in or in relation to manufacture, and did not extend to every part thereof. Thermo-couple tips had already been held eligible by the appellate authority, so that dispute did not survive. Mini tips were reasonably covered by the broader declaration already filed for thermo-couple tips. Clay graphite stoppers were not shown to be complete machines or machinery and, following the Larger Bench view, could not be treated as excluded merely because they formed part of equipment used in manufacture.

Conclusion: The items in question were held to be declared inputs used in or in relation to the manufacture of the final product, and Modvat credit was admissible.

Ratio Decidendi: The exclusion from the definition of input under Rule 57A applies to complete machines, machinery, plant, equipment, apparatus, tools or appliances, and does not extend to mere parts unless the part itself is a complete unit.

---