1999 (12) TMI 603

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.... the duty paid on "High Pressure Water Jetting Pumps & Spares" (HPWJ Pumps & Spares), amounting to Rs. 51,809/- in October, 1996. The department maintained that the said goods namely, "HPWJ pumps and spares" were not acceptable as goods eligible for the credit under Rule 57Q ibid and hence proposed to recover the aforesaid amount of duty and also to impose penalty on the party for alleged contravention of the Central Excise Rules. The party contested this proposal by way of their reply to the show-cause notice issued by the department. In adjudication of the dispute, the jurisdictional Assistant Commissioner of Central Excise confirmed the proposal by disallowing the credit to the aforesaid extent and imposing a penalty of Rs. 5,000/- on th....

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.... to the evaporator (part of chemical recovery plant). He adds that the evaporator is part of the plant and hence, would be covered by clauses (a) to (c) of the aforesaid Explanation. The learned advocate further relies on the Board's Circular No. 276/110/96-TRU, dated 2-12-96, wherein it was clarified that all parts, components, accessories which are to be used with capital goods of clauses (a) to (c) of Explanation (1) of Rule 57Q and classifiable under any chapter heading were eligible for availment of Modvat credit. Drawing support from this Circular of the Board, the learned advocate submits that the evaporator (part of chemical recovery plant) is 'capital goods' falling under chapter heading 84.41 as stated in the memorandum of appeal ....

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....ere covered by clause (d) of the Explanation to Rule 57Q and hence, eligible for capital goods credit. On this set of facts which are apparently similar to the facts of the instant appeal, the Tribunal held that spray guns and its spares were entitled to the capital goods credit under Rule 57Q, having regard to the Board's clarification contained in Circular No. 276/110/96-TRU ibid. 4. The learned advocate has, therefore, prayed for allowing this appeal, following the ratio of the decision of the Tribunal in the case of Emgees Clubley (supra). 5. The learned JDR Shri Y.R. Kilania has opposed the above submissions of the learned advocate and has reiterated the observations contained in paras 2 & 3 of the Assistant Commissione....