1997 (9) TMI 360 - AT - Central Excise

Items like pipelines, valves, and electric motors eligible for Modvat credit under Central Excise Rules

The Tribunal held various items, including pipelines, fire-bricks, thermo couples, air cylinders, valves, filters, wires, chains, conveyor belts, electric ... Modvat - Capital goods Issues Involved:1. Eligibility of various items for Modvat credit as capital goods u/r 57Q of the Central Excise Rules, 1944.Summary:(i) Pipelines for Cement Transportation:The Tribunal held that pipelines used for transporting crushed inputs to the kiln are directly used in manufacturing or processing the final product, cement, and thus qualify as capital goods eligible for Modvat credit.(ii) Pipelines for Air and Water:Pipelines for air and water, essential for transporting crushed material and ensuring proper functioning of the plant, were deemed capital goods and eligible for Modvat credit.(iii) Fire-Bricks / Fire-Crete / S.S. Casting:Fire-bricks, fire-cretes, and SS castings used for lining the kiln were held to be eligible for Modvat credit, following the Tribunal's consistent stance in similar cases.(iv) Thermo Couple:Thermo couples used for measuring temperature in various parts of the plant were considered essential for production/processing of cement and thus eligible for Modvat credit.(v) Air Cylinder:Air cylinders, essential for maintaining pneumatic pressure in the plant, were held to be capital goods and eligible for Modvat credit.(vi) Solenoid and Needle Valves, Gate Valve & Water Meter:These valves, used for controlling the flow of materials in the plant, were deemed essential for processing cement and thus eligible for Modvat credit.(vii) Air/Water/Oil Filters:Filters used for ensuring the quality of air, water, and oil in the production process were considered capital goods and eligible for Modvat credit.(viii) Wires and Cables:Wires and cables, essential for transmitting electricity and signals throughout the plant, were held to be capital goods and eligible for Modvat credit.(ix) Gear Unit:Gear units, used to control the speed of motors in the plant, were deemed capital goods and eligible for Modvat credit.(x) Chain:Chains used in the pully system for lifting cement were considered capital goods and eligible for Modvat credit.(xi) Lifting Liner/Plate:Lifting liners and plates used in the coal mill for crushing coal were held to be capital goods and eligible for Modvat credit.(xii) Glide Flat Woven Synthetic:Glide Flat Woven Synthetic, part of a filter bag used for pollution control, was deemed capital goods and eligible for Modvat credit.(xiii) Bearing Housing:Bearing housings, essential for rotating equipment in the plant, were considered capital goods and eligible for Modvat credit.(xiv) Shaft for P.A. Fan:Shafts for primary air fans, essential for burning fuel in the kiln, were held to be capital goods and eligible for Modvat credit.(xv) Ram Packing Tooth Point for Pool:Since the Department did not contest the Commissioner's order allowing Modvat credit on this item, it was held eligible for Modvat credit.(xvi) Conveyor Belts/Parts/Rollers/Belts:Conveyor belts and their parts, essential for transporting materials in the plant, were deemed capital goods and eligible for Modvat credit.(xvii) Carrying Frames for Conveyor Belts:Carrying frames, being parts of conveyor belts, were held to be capital goods and eligible for Modvat credit.(xviii) Fuses/Fuse Links:Fuses and fuse links, used as protective devices in electrical equipment, were considered capital goods and eligible for Modvat credit.(xix) Electric Motors:Electric motors, essential for rotating the kiln and cement mill, were deemed capital goods and eligible for Modvat credit.(xx) Pressure Measuring Instrument:Pressure measuring instruments used in pipelines were held to be measuring equipment and eligible for Modvat credit.(xxi) Junction Box:Junction boxes, used for protecting electrical equipment and preventing fire, were considered capital goods and eligible for Modvat credit.Conclusion:The impugned orders were modified to the extent stated above, and the appeals were disposed of accordingly.