COMMISSIONER OF CENTRAL EXCISE, Vs. AMERICAN REMEDIES LTD.

JUDGEMENT

(1.) This is a Revenue Appeal filed against the order in Appeal No. 80/90 M(III) dt. 16.4.99 by the Commissioner (Appeals), Chennai by which the Commissioner (Appeals) has allowed the Modvat Credit on Flame Proof Emergency Light, M.S. Addition Tank and Vaccum Trap and S.S. Tank as covered under Capital Goods as defined under Rule 57 Q of the Central Excise Rules 1944. While so doing, he has relied on the following judgements:

(2.) I have heard the Ld. DR Shri S. Arumugam who has reiterated the grounds made out in the appeal memorandum and pleaded for confirming the findings given by the A.C. in the order in original. On careful consideration. I note that the Commissioner (Appeals) has examined the issue in great deal in the light of the definition of the 'Capital Goods' of the CEA Rules. He has noted in respect of each of the item that they are very much essential for producing bulk drugs and Camphor and without which the machinery cannot function and the essentiality has been discussed in the light of the Technical Write -up presented to him. The party has relied on the Larger Bench judgement rendered in the case of Jawahar Mills vs. CCE 1999 (108) ELT 47 which has been clarified by another Larger Bench as in the case of Surya Roshini Ltd. clarified by another Larger Bench. There are other Larger Bench decisions which also clarifies as to how 'capital goods' is required to be treated i.e. in the case of Union Carbide India Ltd. vs. C.C.E. 1996 (86) ELT (T). The Revenue's reliance on the two decisions are no longer are applicable. The Commissioner has rightly upheld the parties contention, which are supported by Larger Bench judgements. The items are very essential for the processing of the gods and without which the machinery cannot function. Therefore, the Commissioner has rightly allowed the credit treating them to fall within the definition of 'capital goods'. There is no error or infirmity in the order. Hence, I reject the Revenue Appeal.