https://www.taxtmi.com/caselaws?id=94110 Spares of an air-conditioning system installed in a factory were treated as capital goods under Rule 57Q because goods need not be directly used in production if they are functionally necessary for manufacture. The system was considered essential to maintain temperature and humidity for spinning cotton yarn, and there was no material showing that it was outside the factory's manufacturing operations. On that basis, duty paid on the spares was held admissible as credit. The stated principle is that equipment necessary to enable the manufacturing process, even if not itself part of the production line, can qualify for capital goods credit when its use in manufacture is established. en-us Thu, 28 Sep 2000 00:00:00 +0530 Sat, 19 Nov 2011 11:40:42 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=94110 Spares of an air-conditioning system installed in a factory were treated as capital goods under Rule 57Q because goods need not be directly used in production if they are functionally necessary for manufacture. The system was considered essential to maintain temperature and humidity for spinning cotton yarn, and there was no material showing that it was outside the factory's manufacturing operations. On that basis, duty paid on the spares was held admissible as credit. The stated principle is that equipment necessary to enable the manufacturing process, even if not itself part of the production line, can qualify for capital goods credit when its use in manufacture is established. Case-Laws Central Excise Thu, 28 Sep 2000 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=94110