CCE, DELHI Vs. Q.H. TALBROS LTD.

JUDGEMENT

(1.) THE issue involved in this appeal, filed by Revenue, is whether Modvat Credit under Rule 57A of the Central Excise Rule, is available in respect of tools during the period from 23 -7 -1996 to 31 -8 -96 to M/s Q.H. Talbros Ltd., Respondents.

(2.) SHRI M. D. Singh, 1d.S.D.R., submitted that as during the relevant period, tools were not covered within the definition of Capital Goods under Rule 57Q, the Assistant Commissioner, disallowed the Capital Goods credit to the Respondents under Adjudication Order No 49/CE/97 dt. 29 -1 -1998; that the Commissioner (Appeals), under the impugned Order No. 1103/CE/DLH/99 dt. 2 -11 -1999 allowed inputs credit in respect of tools observing that as once tools were taken as not covered by the definition of Rule 57Q, they were automatically covered under Rule 57A. The 1d. SDR, further, submitted that the definition on inputs as given in Rule 57A excluded "tools' from the purview of definition of inputs and as such it cannot be said that once tools are taken as not covered by the definition of capital goods under Rule 57Q, they are automatically covered under Rule 57A.

(3.) OPPOSING the prayer, Shri J.S. Agarwal, 1d. Advocate submitted that the Commissioner (Appeals) was justified in holding the inputs credit was available in respect of tools under Rule 57A: that if tools are not capital goods, they will be inputs and it is not in dispute that tools were used by the Respondents in relation to the manufacture of their final products.