LUPIN LABORATORIES LTD Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THIS appeal relates to denial of Modvat credit of Rs. 46,516/ -to the appellants by Adjudication Order No. 79/COMMR/CEX/97, dated 26 -2 -1997 passed by the Commissioner of Central Excise, Indore. The three items in dispute are (1) Pipe fittings (2) Cables and (3) Dehumidifiers. The Commissioner had held that pipe fittings in the nature of extension PTFE '0' ring (head)/PTFE Bellows/PTFE Gasket/Hose assembly were used as pipe fittings and pipe fittings were used for transferring the liquid, air etc. The Commissioner had held that these items are not used for processing of goods nor do they bring any change in the substances. In this view of the matter he had held that they cannot be considered capital goods in terms of Rule 57Q of the Central Excise Rules, 1944, during the material period. As regards the second group of items viz. cable gland/plug spare/electrical cable/copper cable, the Commissioner had found that the said items were in the nature of parts of electrical fittings. Since electrical fittings are meant for transmission of electric current, the said items could be used not only for transmission of electric current to plant but also to other places like office, effluent treatment plant etc., which are not connected with the processing of goods. The Commissioner had observed that there was no evidence that these items are used for supplying of power to plant for manufacture of finished goods and therefore they cannot be called capital goods in terms of Rule 57Q. The third item on which the Commissioner had denied Modvat credit was on Dehumidifiers. The Commissioner had found that the said item was used for supplying humidity -free air and it was not used for processing of goods nor did it bring any change in the substance. He, therefore, held that the said item was not eligible to be considered as capital goods in terms of Rule 57Q.

(2.) LD . Counsel for the appellants has argued that all the three items have been held to be coming within the definition of capital goods under Rule 57Q in the various decisions of the Tribunal. He refers to the present appellants' own appeal in Lupin Laboratories Ltd. v. C.C.E., Indore reported in 1998 (100) E.L.T. 52, wherein the Tribunal had held that whole assembly rubber used and S.S. cover (flexible pipe fitting) to be eligible for Modvat credit under Rule 57Q. It is submitted by the ld. Counsel that the pipe fittings presently under dispute were of the same type as covered by the earlier decision of the Tribunal and therefore the findings of the authorities below are not sustainable. He also refers to a very recent Tribunal decision in C.C.E. v. Hotline Glass Ltd. reported in 1999 (33) RLT 530 (CEGAT), and submits that the ratio clearly applied to the facts of the instant appeal.

(3.) AS regards the second item viz. Cables, ld. Counsel submits that the said item is also clearly covered by the Larger Bench decision of the Tribunal in Jawahar Mills Ltd. v. C.C.E., Coimbatore reported in 1999 (32) RLT 379 (T). In paragraph 40 thereof among the items mentioned as qualifying to be capital goods under Rule 57Q, Cables, Welding Electrodes etc. had been included on the basis of earlier decisions of the Tribunal. He, therefore, submits that cables are fully covered by the earlier decisions of the Tribunal and the matter is settled in the favour of the appellants.