Accessories to qualifying machinery treated as capital goods, making Modvat credit available under Rule 57Q.

High Pressure Water Jetting Pumps and spares used as accessories to an evaporator in a chemical recovery plant were treated as capital goods eligible for Modvat credit under Rule 57Q. The Tribunal noted that the goods were classifiable under sub-heading 8424.90, but accepted that accessories to machinery qualifying under clause (d) of Explanation (1) to Rule 57Q fall within the capital goods definition. It relied on the Board's circular extending credit to parts, components and accessories used with eligible capital goods, and followed earlier Tribunal authority on similar facts. The pumps and spares were therefore covered by clause (d) and credit was available.

---

---

Issues: Whether High Pressure Water Jetting Pumps and Spares, used as accessories to the evaporator in the chemical recovery plant, were capital goods eligible for Modvat credit under Rule 57Q of the Central Excise Rules.

Analysis: The goods were classifiable under sub-heading 8424.90, but were claimed to be accessories of the evaporator, which formed part of the chemical recovery plant. The Tribunal relied on the Board's circular clarifying that parts, components and accessories used with capital goods covered by clauses (a) to (c) of Explanation (1) to Rule 57Q were eligible for credit. It also followed the earlier decision in Emgees Clubley on similar facts and accepted that accessories to qualifying machinery fall within clause (d) of the Explanation.

Conclusion: The pumps and spares were held to be capital goods covered by clause (d) of Explanation (1) to Rule 57Q and were eligible for Modvat credit.

---