TATA IRON & STEEL CO. LTD. Vs. CCE

JUDGEMENT

(1.) The issue involved in this appeal, filed by M/s. Tata Iron and Steel Co. Ltd., is whether Modvat Credit of the duty paid on the various capital goods is admissible to them.

(2.) I Miss Sonu Bhatnagar, learned Advocate, submitted that the Appellants have a cement plant at Raipur; that mine is situated very close to the cement factory; that the mining is a process integrally connected with the manufacture of cement; that the Commissioner under the impugned Order has disallowed Modvat Credit of the duty amounting to Rs. 9,14,153 and has imposed a penalty of Rs. 25,000 that the Commissioner has disallowed the Modvat Credit in respect of pully 20 kV 415 plus 8507 and Tyre/Tube on the ground that these goods are used in Lime Stone Mines and not used within the factory premises for manufacture of cement; that mining is a integral part of the processing connected with the manufacture of cement and the goods used for mining are capital goods and the Modvat Credit should be allowed. Reliance has been placed on the decision in the case of Jay Pee Rewa Cement v. CCE, 2001 (74) ECC 457 (SO : 2001 (133) ELT 3 (SC).

(3.) The learned Advocate, further, submitted that the Commissioner has disallowed the Capital Goods Credit in respect of Zero Grade Nitrogen used for analysis of raw material in clinker in X -ray Analyser and Gas Analyser, Caliberation Gas Mixture and P -10 gas used as X ray analyser and caliberation gas used in caliberation of analysers on the ground that such goods being chemical cannot be considered as capital goods and do not satisfy the definition of capital goods given in Rule 57Q. She mentioned that the Tribunal in the case of CCE, Raipur v. Birla Jute Industries Ltd., 2001 (135) ELT 280 has allowed capital goods credit in respect of spares for X -ray Analyser, controller and electrical equipment used in the laboratory for testing the quality of the products manufactured; accordingly the capital goods credit is allowed in respect of all these gases which are used for testing the final product.