1991 (10) TMI 130

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....s which were found to be unfit for use during the process of filling the fruit juice in bottles were treated as 'wasted'. The Assistant Collector disallowed the Modvat Credit availed by the respondents on the grounds that Rule 57D covers situations wherein a part of the input is contained in the waste, refuse or bye-product, whereas in the respondents' case complete pieces of the Crown Corks had been discarded as damaged or unfit for use. In the impugned order the Collector (Appeals) while setting aside the Order passed by the Assistant Collector, held that in the manufacture of beverages, capping of bottles could be deemed as a process in relation to the manufacture of the final product, and any wastage arising as a result thereof would be....

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....of beverages. 6. In order to appreciate the rival contentions, it is necessary to refer to Rule 57D(1) of the Central Excise Rules, 1944, which is reproduced below :- "Credit of duty not to be denied or varied in certain circumstances. - (1) Credit of specified duty allowed in respect of any inputs shall not be denied or varied on the ground that part of the inputs is contained in any waste, refuse or by-product arising during the manufacture of the final product, whether or not such waste, refuse or by-product is exempt from the whole of the duty of the excise leviable thereon or is chargeable to nil rate of duty or is not specified as a final product under Rule 57A." On a plain reading of Rule 57D it follows that credit of duty on Crow....