Per G.A. Brahma Deva :

These are six appeals filed by the appellants involving a common issue and therefore they are clubbed together and are being disposed of by this common order. The dispute is in respect of denial of modvat credit. Modvat credit has been denied on the following inputs on the ground that either they are not directly used in the manufacture of finished product or in some cases they were used as a part of the machinery and since the machinery is not entitled to modvat credit, the benefit cannot be extended to the parts.

2. Shri R. Nambirajan, Advocate appearing for the appellants in all these cases submitted that total 12 items are involved. These are:

1. Arthracite Based Carbon Block/Graphite Block.

2. Carbon Electrode Paste.

3. Activated Carbon.

4. Acilol - 1214.

5. Indwool Ceramic Fibre Roll

6. Styrite Board

7. Sifton-H

8. Indion NIP

9. Poly Alum Chloride

10. Glass Filter Cloth

11. Sodium Sulphite/Alfloc

12. Cathode Block.

He explained the process of manufacture and how particular item is used in respect of initial product and the details of explanation is as follows :-

1. ANTHRACITE BASED CARBON BLOCK/GRAPHITE BLOCK

The aluminium metal is produced by the electrolytic reduction of alumina dissolved in molten electrolyte consisting of cryolite, aluminium fluoride and calcium fluoride. Graphite block/Anthracite based carbon block is used as carbon electrode in the form of cathode for the purpose of electrolysis of alumina for reduction into aluminium. When the current is passed through the electrode into the bath, electrolysis takes place and aluminium separates from alumina and settles in the pot cell.

2. CARBON ELECTRODE PASTE

Carbon Electrode Paste is a ready made carbon paste which consists of Anthracite Based Carbon and soft pitch used as binder. Carbon Electrode Paste forms part of the electrode used in the manufacture of aluminium.

3. ACTIVATED CARBON

Activated carbon is used in the air-dryer unit to make compressed air free of moisture and this moisture free air is used to wipe out coolant oil from the surface of cold rolled material while processing. This is directly related to the production of aluminium cold rolled products.

4. ACILOL - 1214

Acilol-1214 is used as additives in cold mill coolant oil. This additive is necessary to produce good quality aluminium sheet and is necessary item for cold rolled products and is directly related to production.

5. INDWOOL CERAMIC FIBRE ROLL

Ceramic Fibre Roll (wet and dry) are used for the lining of the trough and tundis of the caster machine where the casting of aluminium is undertaken to produce products of aluminium. The lining of trough and tundis gets damaged after two to three runs and relined again.

6. STYRITE BOARD

Styrite Board is used in the manufacture of concast coils by the aluminium continuous strip caster. In this caster, aluminium coil is produced directly from molten metal by the process of casting between two rolls. In the casting process, styrite boards are used for making casting nozzles. These nozzles get damaged after one casting and cannot be reused. The nozzles of styrite board are essential for such casting and without such nozzles casting of molten metal is not possible.

7. SIFTON-H

Sifton-H is used for metal filtration. It is added in the melting furnace. It is used directly in casting for manufacture of aluminium alloy coils.

8. INDION NIP

Indion NIP is used in the demineralisation plant to demineralise clear water to make it suitable for feeding in the boiler. Clear water cannot be directly used for boiler feed purpose. Water is used in the boiler to make steam which is used for digestion of alumina in caustic soda.

9. POLY ALUM CHLORIDE

Poly Aluminium Chloride is used in water treatment section for floculation settling of mud and thereby reducing the turbidity in river water. The water after poly alum chloride treatment is further clarified and treated and is made suitable for use in the plant.

10. GLASS FILTER CLOTH

Before