Rule 57Q capital goods eligibility for Fairway Lamps required fresh factual examination before Modvat credit could be determined.

Eligibility for Modvat credit under Rule 57Q depended on the actual user of Fairway Lamps in the tyre manufacturing process. The record did not contain a clear finding on whether the lamps formed part of the line projection system and whether that system was used in manufacture. Because the factual foundation was incomplete, the jurisdictional authority had to re-examine the claim after giving the assessee an opportunity to substantiate the case. The matter was therefore remitted for fresh consideration of capital goods eligibility.

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Issues: Whether Fairway Lamps used in line projection for tyre building qualify as capital goods for Modvat credit under Rule 57Q.

Analysis: Eligibility under Rule 57Q depends on the actual user of the item in the manufacturing process. The record did not contain a clear finding whether the Fairway Lamps formed part of the line projection system and whether that system was used in the manufacture of tyres. Since this factual foundation was not established before the authorities below, the issue required fresh examination by the jurisdictional authority, with an opportunity to the assessee to substantiate the claim.

Conclusion: The matter was remitted for re-examination of the eligibility claim under Rule 57Q.

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