TaxTMI 
TaxTMI 
1999 (11) TMI 219
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.... the relevant period namely, June and July, 1996. They took Modvat credit of the central excise duty paid on certain goods as capital goods namely, (1) Auto mill feed pipe, (2) PVC insulated cable and (3) Plain plates during the aforesaid period. The department, however, did not accept these goods as capital goods under Rule 57Q ibid and hence, issued show-cause notice to the appellants asking them to show cause why the Modvat credit taken by them should not be disallowed under Rule 57U of the Central Excise Rules and also why penalty should not be imposed on them under Rule 173Q(1)(bb) of the Central Excise Rules. The appellants replied to the show-cause notice pleading, inter-alia, that all the aforesaid goods fell under the definition of....
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....odvat credit under Rule 57Q ibid for the period June & July 1996, are modvatable capital goods under Rule 57Q of the Central Excise Rules. Regarding the first item, namely, Auto mill feed pipe, learned Advocate has reiterated the factual details of the use of this item in the process of manufacture of cement as stated in the memorandum of appeal and has submitted that the said item is sine-quo-non for the process of manufacture. He has further invited my attention to the decision of the Tribunal in the case of Modern Petrofils v. C.C.E., Baroda reported in 1997 (96) E.L.T. 404 (Tribunal), wherein a variety of goods including black steel tubes/pipe fittings used for flow of various media like air, steam and water within the plant in the fact....
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....ctory. Therefore, I am inclined to draw support from the decision of the Tribunal in the case of Modern Petrofils (supra) cited by the learned Counsel for the appellants and to hold that auto mill feed pipe would qualify to be capital goods under the Explanation to Rule 57Q(1) of the Central Excise Rules. In this connection, it is noted that the lower appellate authority has chosen to disagree with the ratio of the decision of the Tribunal in the case of J.K. Synthetics Ltd. v. C.C.E., with regard to Notification No. 14/96, dated 23-7-1996 and has upheld the denial of Modvat credit by the Assistant Commissioner on auto mill feed pipe. The lower appellate authority has observed that "it is not clear what kind of pipes are these". Nevertheles....
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....td. v. Commissioner of Central Excise, Coimbatore reported in 1999 (108) E.L.T. 47 (Tribunal), wherein it has been held that wires and cables are a part of "plant" under the explanation to Rule 57Q(1) of the Central Excise Rules and hence, are modvatable capital goods. Learned JDR, on the other hand, has submitted that the PVC insulated cables in question are not used in plant but in EOT crane and hence, would not attract the ratio of the decision of the Tribunal in the case of Jawahar Mills Ltd. (supra). I observe that, as rightly contended by the learned Counsel for the appellants, the crane in which the cables are used is, by itself, a material handling equipment used in the appellants' factory falling under the category of capital goods....
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....ner of C. Ex., Coimbatore reported in 1998 (98) E.L.T. 156 (Tribunal) to fortify his plea that M. S. plain plates are not to be considered as capital goods under Rule 57Q ibid. On a perusal of the decision cited by the learned DR, I find that certain goods, namely, M. S. rounds, M. S. angles and tor steel used in the construction of building for housing furnaces in the course of expansion of a factory were held to be ineligible for Modvat credit under Rule 57Q ibid. This reasoning should be applied equally to M.S. plain plates involved in the present appeal, according to learned JDR. I can hardly agree with this argument because the M.S. plain plates in the instant case are used for replacement of worn out, broken parts of the kiln shell, w....