1998 (6) TMI 317

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....and Industrial machinery falling under Heading No. 84 of the Central Excise Tariff Act, 1985, and clearing the goods on payment of appropriate rate of duty. They have opted for availment of Modvat facility under Rule 57A and filing the declaration for inputs on which they intend to take credit and maintain the record as required. They have taken credit on a Grinding Wheel which was received under the GP No. 2684 on 31-5-1989 and 8-7-1989 under RG 23A Part II, E. No. 216/268, dated 22-6-1989 and 8-7-1989 respectively. The grinding wheel is neither an input, nor used in or in relation with the manufacture of the final product, and so the credit taken is not eligible. Show Cause Notice was issued on 13-2-1990, and after receiving the reply on ....

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....acture of frit. The principles of use of input in or in relation to the manufacture of final product is to be looked into, and not the function of the machines installed in the factory through which or with the aid of such machines the inputs are used in relation to the manufacture of final products. 4. Regarding the Ceramic grinding media in the shape of balls, it is used for mastication of glass frit by putting the same with frit in the ball mill. It is not a part of ball mill. When the ball mill rotates the grinding media comes into fraction with particles of frit and on account of this process the particle size of frit becomes fine which will be suitable for application on the surface of metalware with the aid of spray gun. Show....

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.... the Northern Bench has also held in the same line. Looking to the usage of input Ceramic balls in this case the same principles apply and it is eligible for Modvat. 8. Regarding the grinding wheel the appellants claims it as an input used in the manufacture of the final product to smooth the surface coming under item No. 68 which is not for tool machines etc. According to the Respondents, it is the tool. Looking to the usage as contended by the appellant in the above paras, it is clear that grinding wheel does not come into the category of tools or equipment. In the case of the appellant there is the precedent decision of this Bench in E/21/91-BOM under Order No. 3059/97-WZB, dated 17-7-1997 on the same issue. Relying on the Larger....