2006 (1) TMI 275

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....used in the manufacture of the final products and as such, has no direct or indirect nexus with the final goods. In addition, personal penalty of identical amount has been imposed under the provisions of Rule 57Q along with confiscation of land, building, plant, machinery, conveyance, etc. with an option to the appellants to redeem the same on payment of redemption fine of Rs. 5 lakhs. In addition, personal penalty of Rs. 10,000/- each has been imposed upon the other appellants, who are the Managing Director and Sr. Manager, under the provisions of Rule 209A of Central Excise Rules, 1944. 2. As per the facts on records, the appellants are engaged in the manufacture of medicines falling under Chapter 30 of Schedule to Central Excise ....

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....the table annexed to the said Rule and used in the factory of the manufacturer of final products. (emphasizes provided). As such, it is seen that for earning the credit in terms of the said Rule, the only requirements for such specified capital goods should be used in the factory of the manufacturer of the final products. Undisputedly, Research Laboratory is situated in the licensed factory premises of the appellants, and are being used for the manufacture of the excisable goods. As such, going by the definition of the capital goods, the disputed items in question earn the credit irrespective of their not being actually used in the production of the final products. 5. We also solicit support from the Bombay Commissionerate Trade Not....

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....h decision in the case of Jawahar Mills Ltd. v. Commissioner of Central Excise, Coimbatore, reported in 1999 (108) E.L.T. 47 (Tri.). After taking note of the speech made by the Finance Minister, Tribunal referred to Para 16(iii) of the Circular issued along with Budget 1995, which stands reproduced in Para 10 of the said decision. For better appreciation, the same is being reproduced. "(iii) In the case of capital goods, the scope of capital goods has been extended by specifying a large number of machinery which will qualify for credit under Rule 57Q. In respect of such capital goods, it has been provided that so long these are used in the factory of production, credit will be allowed, without the need to establish as to whether suc....