Modvat credit on phosphoric acid used in sugar manufacture upheld as the input was necessary for purification.

Modvat credit was admissible on phosphoric acid used in the manufacture of sugar because the input was treated as necessary for the purification process involved in producing commercial sugar. The tribunal followed an earlier bench view that phosphoric acid was a required input and accepted the lower appellate authority's reliance on that position. Credit was therefore allowed, and the appeal failed.

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Issues: Whether Modvat credit was admissible on phosphoric acid used in the manufacture of sugar.

Analysis: The dispute turned on whether phosphoric acid was a necessary input for the purification involved in the manufacture of commercial sugar. The record showed that the lower appellate authority had relied on an earlier bench view that phosphoric acid was a necessity and that credit was therefore admissible. On that basis, the tribunal found no reason to differ from the earlier position.

Conclusion: Modvat credit on phosphoric acid was held admissible, and the appeal failed.

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