2011 (9) TMI 725

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....t was allowed.   2. The substantial question of law raised by the appellant is asto whether the credit under Rule 2(f) of the Cenvat Credit Rules, 2001, on explosives used outside the factory premises, can be allowed when the rules stipulates that the credit is allowed on the inputs which are used within the factory of production.   3. The facts, in brief, are that the respondent admittedly used Ammonium Nitrate and other explosive  materials outside the factory mines for production of lime stone which was used in the factory of the respondent for production of cement. The respondent claimed Modvat credit on the explosives used outside the factory for the purpose of producing limestones which is a raw material for produ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e final products, goods used as paint, or as packing material, or as fuel, or for generation of electricity or steam used for manufacture of final products or for any other purpose, within the factory of production, and also includes lubricating oils, greases, cutting oils and coolants."   4. Clause (f) of Rule 2 of the Cenvat Credit Rules, 2001, reads as under:   "inputs means all goods, except high speed diesel oil and motor spirit, commonly known as petrol, used in or in relation to the manufacture of final products whether directly or indirectly and whether contained in the final product or not and includes lubricating oils, greases, cutting oils, coolants, accessories of the  final products cleared along with the f....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....in the factory premises.   The explanation contained in Rule 57A is merely meant to enlarge the meaning of the word `input' and does not in any way restrict the use of the input within the factory premises nor does the said rule 57A require the inputs to be brought into the factory premises at any point of time.   13.On the explosives a duty had been paid and the appellants would be entitled to claim credit because the explosives were used for the manufacture of the intermediate product, namely, lime stone which, in turn, was used for the manufacture of cement."   8. The above stated ratio was doubted in CCE v. J.K.Udaipur4. A three Judges Bench of the Supreme Court, in Vikram Cement v. Commissioner of Central Excise....