C.C.E., DELHI Vs. HARYANA TELECOM. LTD.

JUDGEMENT

(1.) THE respondents manufacture "Jelly filled Telephone Cables and Wires" Falling under Chapter heading 8544 of the Central Excise Tariff Act, 1985. They availed modvat credit totally amounting to Rs.2,29,129/ - on wires and cables as capital goods under Rule 57 -Q of the Central Excise Rules, 1944. The Asst. Commissioner of Central Excise, Rohtak vide his Order dt. 23.3.98 observed that wires and cables were being used by the party for supply of electrical power to machines/meters and plant. He also observed that these are not used for producing or processing any goods or for bringing about any change in substance for manufacture of final product and thus they did not fall under the definition of capital goods. Accordingly, the Asst. Commissioner in his Order disallowed modvat credit of the aforestated amount to the respondents a part from imposing a penalty of Rs. 25,000/ - on them.

(2.) ON appeal, the Commissioner (Appeals). New Delhi vide his Order dt. 27 -9 -99 allowed the appeal of the party by setting aside the order passed by the Originally Authority.

(3.) THE Revenue are in appeal against the above order of Commissioner (Appeals). I have heard Shri A.K.Jain, JDR for the appellants. The respondents are not represented. They have, however, sent a communication dt. 6.4.2001, in which ,reliance is placed on the judgement of the Hon'ble High Court of Madras in the case of M/s. SIV Industries Ltd. vs. CCE., Coimbatore reported in 2001 (129) ELT 48 (Mad.) I have considered the submissions made before me. The Hon'ble Madras High Court in the cited decision, on going through into the details in the definition of the expression "capital goods", "manufacture" and "plant" as specified under the provision of Rule 57 -Q have come to the conclusion that he word implied in the definition "plant" being a term of wide import. The facts that it is used in the context of processing of "manufacture", the definition in the Act; it would include goods which are necessary to make that production/process possible. It is observed that power being essential to the process of wires and cables required to bring that power to the machines, appliances etc. are also covered by the definition of capital goods.