2001 (9) TMI 864

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.... filed on these items. 2. The appellants are engaged in the manufacture of electron guns. They are availing Modvat credit under Rule 57A. A dispute arose as to whether finger tips are inputs or not. The contention of the Department was that finger tips do not directly participate in the process of manufacture and therefore; they are not inputs. The assessee submitted that electron guns are very sensitive equipments which cannot be handled with bare-hands and need some type of covering on the hands so that the electron guns may be handled. However, the authorities below were not satisfied with this explanation given by the appellant. 3. Regarding Air gripper and extruded plate, the Department was of the view that since these ....

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.... has sold the goods in question to certain manufacturers who were manufacturing iron and steel materials. It is also clear from Question No. (i) that those gloves were to be used by workmen who were engaged in hot jobs or in handling corrosive substances in the course of manufacture. That being so, it cannot be denied that those gloves had to be used in the course of manufacture". For coming to this conclusion the Apex Court had relied on its earlier judgment in the case of J.K. Cotton Spinning & Weaving Mills Ltd. v. Sales Tax Officer, Kanpur reported in 1997 (91) E.L.T. 34. In that case their Lordship of the Supreme Court had observed - "The expression in the manufacture of goods should normally encompass the entire process carried ....

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....DR submits that finger tips are neither inputs nor can be treated as capital goods which had directly participated in the process of manufacture or in the manufacture of the finished goods namely electron guns. He submits that for qualifying as inputs under Rule 57A, the item should have directly participated in the manufacture of the final product. Regarding Air gripper and extruded plate, ld. DR submits that for availing Modvat credit under Rule 57T/57G of Central Excise Rules, 1944, description is necessary in the declaration filed. He submits that subsequent production of clarification from the manufacturer is not a deciding factor unless it was supported by the requisite catalogue or literature sent alongwith the consignment as it was ....