2016 (11) TMI 917

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....ase is that whether the appellant is entitle for Modvat credit in respect of testing instrument namely Instron Model 14464 Table Mounted Universal Testing Instrument under the Capital goods in terms of Rule 57Q of Erstwhile Central Excise Rules, 1944. The Adjudicating authority and first appellate authority denied the Modvat credit on the ground that the said testing instrument was used for testing purpose and not for producing or processing or bringing about any change in substance for manufacturing of final product. 3. None appeared on behalf of the appellant despite notice served through SDR. 4. On the other hand, Shri. Sanjay Hasija, Ld. Superintendent (A.R.) appearing on behalf of the Revenue reiterates the findings of the impugn....

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....ntegral part of manufacturing activity. In the appellants' case the computer in question carries out these vital functions. Therefore, it has a direct role to play in the manufacture. It is clear from the decisions relied on by the appellants that capital goods eligible for Modvat credit are not merely the goods which directly process the raw material. But also capital goods taking part in production in an indirect and auxiliary capacity. It is also clear that material handling and testing equipment are also eligible for capital goods credit. The only difference in the present case is that the material testing and selecting machine is an electronic machine. This should make no difference inasmuch as eligible machines are the machines playin....

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.... clear nexus with the manufacturing process of final product i.e. wires and cables. In my view the role of the testing equipment under consideration in the manufacture of yarn is akin to that of the spectrophotometer in relation to the manufacture of plastic sheeting compound. COMMISSIONER OF C. EX., JAIPUR Versus HI-TECH GEARS LTD.[ 2000 (116) E.L.T. 523 (Tribunal)] 6. In view of the finding given by the authorities below that these are testing equipments and are essential requisite for manufacture of finished goods in the appellant's plant and following the ratio of the decision of the Tribunal in the case of Jawahar Mills, referred to above, I do not find any infirmity in the impugned order. In the result, the appeal is....