WESTERN INDIA PLYWOODS LTD. Vs. CCE, COCHIN

JUDGEMENT

(1.) THIS appeal arises from Order -in -Appeal No. 20/95 dated 14.12.1995 rejecting the claim of Modvat credit in respect of Fork Lift Trucks used within the factory for lifting the goods which are required for manufacture of the final products. The appellants claimed Fork Lift Trucks were used in the factory as capital goods in terms of Explanation Rule 57Q of CE Rules. The Commissioner (Appeals) held by the very nature, Fork Lift Trucks are meant for cartage and transportation of heavy materials from one spot to the other and are being used out of the factory of the appellants and that they have no role directly or indirectly in the production or processing of Plywood or Cardboards. Ld. Counsel submits that the issue is covered in favour of the appellants in terms of Apex Court judgment in the case of Collector v. Rajasthan Chemical Works as reported in, 1991 (55) ELT 444 (SC) :, 1991 (36) ECR 465 (SC) wherein the Apex Court has held that any process which requites for handling the goods is to be considered as a process of manufacture. She submits that this issue is also covered by the Tribunal in the case of CCE v. Kitply Industries Ltd. as in : 1999 (107) ELT 78 :, 1999 (82) ECR 738 (T) wherein it was held that Fork Lift Truck held before 16.3.1995 and used for handling raw materials and in processing material was required to be considered as capital goods for grant of credit in terms of Rule 57Q of CE Rules.

(2.) LD . DR. reiterates the departmental contention. On a careful consideration of the submission, I notice that the issue is covered in appellant's favour in terms of Apex Court judgment cited above and in the case of CCE v. Kitply Industries Ltd. wherein in identical circumstances, the Tribunal held that Fork Lift Trucks used in handling raw materials and in processing of material were to be considered as capital goods and Modvat credit is required to be extended in terms of Rule 57Q. In that view of the matter, applying the ratio of the judgments cited above, the impugned order is set aside and appeal allowed, with consequential relief, if any.