2001 (10) TMI 782

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.... by the adjudicating authority. The Revenue preferred appeal against the order of adjudication to the Commissioner (Appeals). The lower appellate authority rejected the Revenue's appeals. Hence the present appeal of the Revenue before the Tribunal. 2. The goods in respect of which Modvat credit was allowed to the present respondents by both the lower authorities are listed below :- (i)         Cable Glands (ii)        Switches (iii)       Electrical Spares (iv)       Senior Proximity Switch (v)        Static Converter (vi)    &n....

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....t and control flow of electricity only". The appellant further submits that none of the aforesaid goods can be considered to be capital goods within the meaning of Rule 57Q for any period prior to 23-7-96 and that the changes brought about by Notification No. 14/96-C.E. (N.T.), dated 23-7-96 are not retrospective. Since the period of dispute involved in this case is prior to 23-7-96, the respondents will not be entitled to the benefit of the said Notification. As regards the reliance placed by the lower appellate authority on the Tribunal's Larger Bench decision in Jawahar Mills (supra), the appellants submits that the Department has filed Special Leave Petitions against that decision of the Larger Bench as well as subsequent decisions rend....

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....ings, ld. Counsel cites the decision of the Tribunal in respondents' own case viz. Lupin Laboratories Ltd. v. CCE, Indore [2000 (115) E.L.T. 372]. Since all the goods in question have been held to be capital goods. Ld. Counsel prays for rejecting the Revenue's appeal. 7. I have examined the submissions. I find that, in the present appeal, the Revenue has not contested the uses of the goods in question as noted by the adjudicating authority. The main ground raised in this appeal appears to be that, for any capital goods to be held to be eligible for Modvat credit under Rule 57Q, it should be established that the goods have a direct nexus to the process of manufacture. It is this ground which has been pressed before me by ld. DR. In t....

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....that view and hence can hardly be sustained. 8. As regards pipe fittings (not an electrical item) which were admittedly used to convey solvents and chemicals to the reactors, the appellant has no case that those goods do not have any nexus to the process of manufacture. All those pipes within the factory premises which convey chemicals, solvents and other raw materials to the reaction vessels/reactors/agitators in the respondents' factory have direct nexus to the chemical reactions resulting in the final products. Hence the pipe fittings are capital goods eligible for Modvat credit under Rule 57Q. The Tribunal's decision in the respondents' own case cited by ld. advocate supports their claim in the present appeal, for Modvat credit ....