Modvat credit on boiler accessories allowed where I.D. Blower and Economiser Coil supported efficient functioning of eligible capital goods.

I.D. Blower and Economiser Coil fitted to a boiler were treated as accessories of capital goods because they enabled efficient combustion and heat recovery, supporting the boiler's effective functioning. As the boiler itself was eligible for Modvat credit, the attached items were not regarded as independent disqualifying goods under Rule 57Q. The claim for Modvat credit was therefore accepted and the Revenue's objection rejected.

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Issues: Whether I.D. Blower and Economiser Coil used with a boiler were eligible for Modvat credit as accessories of capital goods under Rule 57Q of the Central Excise Rules.

Analysis: The items were found to be fitted to the boiler and used to ensure efficient combustion and heat recovery. Since the boiler was itself eligible for Modvat credit and these items enabled its efficient functioning, they were treated as accessories of the boiler and not as independent items disentitling credit.

Conclusion: The claim for Modvat credit on I.D. Blower and Economiser Coil was accepted and the Revenue's objection was rejected.

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