ULTRAPACK Vs. COMMISSIONER OF CENTRAL EXCISE, HYDERABAD

JUDGEMENT

(1.) BOTH these appeals arise from two Order -in -Appeal No. E/89/2002 -C.E., dated 30th September, 2002. In both the appeals common question of law and facts arise for disposal as per law. The appellants are manufacturers of Robin Blue. The said product is supplied with plastic spoons whose value is already included in the assessable value and they are availing Modvat credit in respect of duty paid plastic spoons. It is the contention of the Revenue that it is only an accessory and not essential for the purpose of marketing robin blue.

(2.) LEARNED Counsel submits that the issue is no longer res integra and has cited the judgment rendered in R.K. Herbals Pvt. Ltd. v. CCE, Pondicherry [2004 (167) E.L.T. 448 (Tri. - Chennai)] wherein in similar circumstances, plastic spoons and bowls supplied along with herbal sikkakai powder are held to be eligible for the grant of Modvat credit.

(3.) WE have carefully considered the submissions and find that the contentions raised by the appellant is required to be accepted in view of the judgment of the Tribunal rendered in the case of R.K. Herbals Pvt. Ltd. (supra) wherein in similar circumstances Modvat credit in respect of spoons and bowls supplied along with herbal sikkakai powder was held to be eligible. We find that the judgment relied by DR in the case of Jayshree Industries v. CCE [1993 (63) E.L.T. 492 (Tri.)] is clearly distinguishable as dry battery cells fitted to quartz clocks and time pieces were held to be essential components to make the final product operational and marketable and not an accessory therefor. In view of the citations relied by the learned Counsel, we set aside the impugned order and allow the appeal with consequential relief.