1997 (4) TMI 231

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....rocessing of the wooden sheets for the manufacture of hardboards. The period involved is December 1994 to June 1995. The learned lower authority has denied the benefit of Modvat credit for the reason that the fuel used is for manufacture of steam, which is an exempted product and therefore in terms of Rule 57(C), the benefit of Modvat credit could not be allowed. 3. The learned Advocate has pleaded that the fuel as such was included in the list of eligible inputs under the definition for input as set out under Rule 57A with effect from 1-3-1994. It seen from the order of the learned lower authority that the sole ground under which Modvat credit was denied was that the steam itself is a notified final product which is exempted from C....

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....e 57D(2) which clearly provides for grant of Modvat credit even where an intermediate product is exempted. She has also cited the decision of the South Regional Bench in the case of Collector of Central Excise v. Seshasayee Paper Boards Ltd. reported in 1992 (61) E.L.T. 304. The Tribunal in that case she has pleaded has extended the benefit of Modvat credit to inputs which were used in the purification of water and which water was subsequently used for generation of steam for use in the factory. She has therefore prayed for allowing the appeal of the appellants. 4. The learned SDR for the Department has adopted the reasonings of the learned lower authority. 5. We have considered the pleas made by both the sides. We observe t....