COLLECTOR OF CENTRAL EXCISE Vs. LUDHIANA BOTTLING CO.

JUDGEMENT

(1.) SINCE these appeals involve the same issue, they are being disposed of by this common order.

(2.) THE facts of the case are that the respondents availed of Modvat Credit on Crown Corks used as inputs in relation to the bottling of beverages marketed under the brand name 'Mazza'. Some of the Crown Corks which were found to be unfit for use during the process of filling the fruit juice in bottles were treated as 'wasted'. The Assistant Collector disallowed the Modvat Credit availed by the respondents on the grounds that Rule 57D covers situations wherein a part of the input is contained in the waste, refuse or bye -product, whereas in the respondents' case complete pieces of the Crown Corks had been discarded as damaged or unfit for use. In the impugned order the Collector (Appeals) while setting aside the Order passed by the Assistant Collector, held that in the manufacture of beverages, capping of bottles could be deemed as a process in relation to the manufacture of the final product, and any wastage arising as a result thereof would be eligible for Modvat Credit.

(3.) ON behalf of the Revenue, the learned JDR, Shri S.K. Sharma, stated that for the purposes of Rule 57D, the input should be contained in the waste, refuse or byproduct. He contended that in this case, the position was different since the respondents for their own convenience had chosen not to use the Crown Corks in question as inputs in relation to the manufacture of the final product even though they could not be deemed as damaged or forming a part of waste or refuse.