COMMISSIONER OF CENTRAL EXCISE Vs. HIND SYNTEX LTD.

JUDGEMENT

(1.) IN this Revenue Appeal, the Order -in -Appeal passed by the Commissioner (Appeals), Bhopal dated 9 -7 -1998 holding that P.V.C. Armoured Cables are eligible for credit as capital goods under Rule 57Q of Central Excise Rules, 1944 has been challenged. There is also a cross -objection filed by the Respondents referring to various decisions of the Tribunal holding that Cables are eligible for Modvat credit under Rule 57Q.

(2.) LD . JDR, Shri Y.R. Kilania has submitted that the Explanation relating to 'capital goods' in terms of Notification No. 14/96 -C.E. (N.T.), dated 23 -7 -1996 did not include PVC Armoured Cables falling under Chapter sub -heading 8544.00, one of the categories mentioned against (a), (b), (c) and (d) of the definition of the 'capital goods'. According to the Revenue, the meaning of 'capital goods' under categories (a) and (b) of the Explanation was related with the use for producing or processing of any goods or for bringing about any change in the substance for manufacture of final products. Likewise, categories (c) and (d) related to the process of manufacture. The Tribunal in C.C.E. v. Shanmugamja Spinning Mills (P) Ltd. reported in 1997 (89) E.L.T. 84 (Tribunal) had held that for any item to come within the scope of the definition of 'capital goods' under Rule 57Q, such item has to be used in the process of manufacture or for bringing about a change in the substance of the goods. P.V.C. Armoured Cables cannot be considered to be falling under any of the aforesaid categories and therefore, the Commissioner (Appeals) had wrongly held that P.V.C. Armoured Cables would be eligible to be considered as 'capital goods'.

(3.) I have perused the grounds of the cross -objection filed by the Respondent. Reliance has been placed by the Respondent in the Tribunal decision in C.C.E. v. Nova Udyog reported in 1997 (92) E.L.T. 229 (Tribunal) and certain other decisions given in the cross -objection.