Per K.K. Agarwal :

The appellants in this case have been denied Modvat credit on M.S. Plates, M.S. Angles, M.S. Channels, Aluminium Sheets, Ceramic Blankets, Nuts and Bolts, Laping Paste, Graf Seal Tapes total amounting to Rs. 1,93,877.79 on the ground that they cannot be considered as parts, components, accessories of capital goods as per the definition of the capital goods under Rule 57Q of the erstwhile Central Excise Rules, 1944.

2. Learned advocate for the appellants submits that so far the admissibility of the M.S. Plates, M.S. Angles, M.S. Channels is a concerned CESTAT has in their own case allowed the credit on the same vide Order Nos. C-IV/1380-83/WZB/03 dated 25.11.2003, Order No. C-IV/1313/WZB/03 dated 24.11.2003 and C-IV/1295/WZB/03 dated 24.11.2003. The Tribunal while allowing the credit has placed reliance on the decision of CEGAT in the case of Simbhaoli Sugar Mills Ltd. Vs. Commissioner of the Central Excise, Meerut - 2000 (39) RLT 686 (CEGAT)=2001 (135) E.L.T. 1239 (Tri.-Del.), which in turn was upheld by Apex Court. The above CESTAT decisions also allowed Modvat credit in respect of aluminium sheet used for manufacture of plant. As regards ceramic blankets he submitted that Commissioner (Appeals) has admitted them as insulating material used in the manufacture of their plant and drew my attention to the CEGAT decision in the case of Collector of the Central Excise, Chandigarh Vs. Gujarat Ambuja Cement Ltd. - 2000 (115) E.L.T. 579 (Tribunal) where aluminium rolled sheets used as insulating material in electro static precipitators were held as entitled to benefit of Modvat credit under Rule 57Q. It was submitted that so far as Nuts & Bolts are concerned they are also used for assembling the various components and parts for erecting plants and therefore they are part of the plants and credit cannot be denied on the same. The learned advocate did not press for allowing the credit in respect of laping paste and graf seal tape.

3. I have considered the submissions. I find that the appellants in their own case have been allowed the Modvat credit in respect of M.S. Plates, Angles, channels, aluminium sheets in the decisions of CEGAT cited supra which has followed the decision CEGAT in the Simbhaoli Sugar case which was upheld by the Supreme Court. Relevant para 5 of this decision is reproduced below for better understanding.

"5. Heard the rival submissions. I find that in the case of Malvika Steel Limited, there is a finding that the items were used as building material of the plant. If the items are used in the construction of the wall or any part of the plant structure as construction material that part has been disallowed. However, if the same material is used for raising structure to support the various machines parts of machine then they will be covered by the explanation to Rule 57Q. Plant no doubt has wide connotation and covers not only machine, machinery, equipment, parts, accessories and components but also the permanent structure in the form of walls etc. Therefore, reading down independent explanation given under Rule 57Q, we have to see whether the items claimed as components and accessories are actually components and accessories and other materials used in the manufacture of machine, machinery, equipment, apparatus, etc. In the instant case, the use of the material is more like the one dealt with in their own case of the appellants. I, therefore, follow the decision of this Tribunal in the case of the appellants themselves and hold that Modvat credit will be admissible on the items listed in the order passed by the Commissioner (Appeals) except M.S. sections and M.S. shapes. The appeal is, therefore, disposed of in the above terms."

4. The above decision make it clear that credit cannot be denied on the ground that the inputs are construction materials unless it is held that inputs are used for civil construction and are not part of plant and machinery not used for raising structure to support various