TaxTMI 
TaxTMI 
2006 (2) TMI 542
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....and repairs & maintenance purposes. They contend that the activity is not of construction work. The inputs were used within the factory for captive consumption and the use of gases of Oxygen, Acetylene and Argon are for welding purposes of capital goods and unless these capital goods were utilized, the final product cannot be manufactured. He contends that this bench, in the case of India Sugar and Refineries by Final Order No. 1997/2005 dated 24-11-2005 [2006 (205) E.L.T. 717 (Tribunal)], examined the issue in the light of the Larger Bench judgment and the Punjab & Haryana High Court judgment rendered in the case of CCE, Chandigarh v. National Fertilizers Ltd. - 2002 (140) E.L.T. 372 (P&H) = 2002 (79) E.C.C. 758 (P&H) and held that this pr....
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....noting the ruling of Apex Court judgment rendered in the case of J.K. Cotton Spinning and Weaving Mills Co. Ltd. v. Sales Tax Officer - 1997 (91) E.L.T. 34 (S.C.), took a view that the repairs and maintenance of machinery are not normally done when the process of manufacture of goods with such machinery is under way. It also held that the process is not a part of, or integrally connected with, the process of manufacture of final product. This Larger Bench did not take into consideration, the earlier Larger Bench decision rendered in the case of CCE v. Modi Rubber Ltd. - 2000 (119) E.L.T. 197 (Tribunal-LB) headed by the then President Justice K. Sreedharan and the other members as were in Jaypee Rewa Plant. In Modi Rubber Ltd.'s case, it was....
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....helly - 1997 (4) SCC 478. It has also held that the High Court decision will prevail over the Tribunal decision even if it is a Larger bench decision. It has also held that the decision of Apex Court will prevail under Article 141 of the Constitution. In the light of this observation, we have to see as to whether the ruling of Jaypee Rewa Plant is a good law or not. The Punjab & Haryana High Court, in the case of CCE, Chandigarh-II v. National Fertilizers Ltd. (cited supra) has held in paras 7 to 9 as follows:- "7. We have considered the arguments of Mr. Sehgal. The steam generation and its ultimate generation of electricity is a part and parcel of the composite process, which produces the final product, i.e. fertilizer. For the ef....
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....of the manufacturing process of that end product. The ammonia used in the treatment of effluents from the urea plant of the appellants has, therefore, to be held to be used in the manufacture of urea and the raw naptha used in the manufacture of such ammonia to be entitled to the said exemption." The same view was also expressed by the Apex Court in M/s. Steel Authority of India Ltd. Etc. v. Collector of Central Excise, A.I.R. 1996 Supreme Court 2544. 8. As a sequel to the above discussion, it is held that the furnace oil, which was used in the manufacture of steam, which in turn was further used in the generation of electricity during the shut-down period, was entitled to the concessional rate of duty. 9. In the ....
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....Court judgment rendered in the case of Collector v. Ballarpur Industries Ltd. - 1989 (43) E.L.T. 804 (S.C.), Collector v. Eastend Paper Industries Ltd. (supra) and also that of the Patna High Court judgment rendered in the case of Collector Tata Engineering & Locomotive Company Ltd. - 1999 (31) R.L.T. 800 (Patna). A combined reading of the P & H High Court judgment and the Modi Rubber Ltd. Case clearly supports the plea that Welding Electrode pipelines carrying hot sugar juice is also a process of manufacture and it is an integral part in the process of production of final goods. Another Larger Bench, in the case of Union Carbide India Ltd. v. CCE - 1996 (86) E.L.T. 613 (Tribunal), has held that the words Inputs 'in relation to the manufact....