Per Shri P.C. Jain :

Heard both sides.

2. I have also considered the citations 1994 (69) ELT 779 cited by the ld. SDR and 1993 (68) ELT 146 (Trib.) cited by the ld. advocate.

3. Sole question involved in this appeal is whether the appellants could take modvat credit on goods already cleared by the appellant as final product and returned on the same gate pass, by endorsement by the consignee of the goods in the first instance, for the purpose of manufacturing the same final product through the process of melting.

4. I am very clear that the provisions of rule 57A cannot be applied in the aforesaid circumstances because the scheme of rule 57A rests on the premise that final product is brought into existence by the process of manufacture from the inputs. Manufacture, it is well settled, implies bringing into existence a new commodity having a different name, character and use. In the instant case, defective aluminium extrusions have been converted into aluminium extrusions. No new product has come into existence. Hence provisions of rule 57A are not applicable.

5. There are specific rules for this purpose i.e. rule 173H or 173L. The appellant should have followed that procedure. It is