LexCOMMISSIONER OF CENTRAL EXCISE, COIMBATORE AND ORS. versus JAWAHAR MILLS LTD. AND ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
COMMISSIONER OF CENTRAL EXCISE, COIMBATORE AND ORS.
V.
JA WAHAR MILLS LTD. AND ORS.
JULY 27, 2001
B
[S.P. BHARUCHA AND Y.K. SABHARWAL, JJ.]
Excise laws :
Central Excise Rules, 1994-Explanation to Rule 57Q-Capital Goods-
C Power cables, capacitors, control panels, cables distribution boards, switches,
starters, air compressors-Held, the said items are Capital Goods under the
Rule.
Respondent-manufacturers treated power cables, capacitors, control
D panels, cables distribution boards, switches, starters, air compressors and other
like items as Capital goods and claimed Modvat Credit for the duty paid under
Rule 57Q of the Central Excise Rules, 1944. Revenue disallowed the claim.
CEGA T allowed the appeal of the respondent-manufacturers.
In appeal to this Court, Revenue contended that whether an item falls
E within the definition of 'Capital Goods' would depend upon the user it is put
to; and that the items could not be treated as 'Capital Goods' as the
respondents could not establish that the items were used in the manufacture
of final product.
F
Dismissing the appeals, the Court
HELD : 1.1. The definition of 'Capital Goods' in E,xplanation to Rule
57Q of the Central Excise Rules, 1944 is very wide. The language used in the
Explanation is very liberal. In view of the liberal language of the provision, if
any of the items enumerated in Explanation l(a) is used for any purpose
mentioned therein for the manufacture of final product, it would satisfy the
G test of'Capital Goods'. It was not the case of the Revenue at any stage before
the authorities that an item does not satisfy the requirement of 'Capital Goods'
within the meaning of the Rule on the ground of its user. The case of the
Revenue has all through been that the items in question per se are not 'Capital
Goods' within the meaning of the expression as defined in Explanation l(a).
H On facts and circumstances of these cases, the items in question are not used
58
COMMR. OF CENTRAL EXCISE v. JAWAHAR MILLS LTD.
59
for manufacture of final product cannot be accepted. [62-8; 64-A-CJ
A
Indian Farmers Fertilisers Cooperative Ltd v. Collector of Central Excise,
Ahmedabad, [1996) 5 SCC 488, relied on.
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 619-626
of 2000.
From the Judgment and Order dated 13.4.99 of the Customs Excise and
Gold Control Appellate Tribunal, Delhi in Misc. 0. Nos. M/60-67 of 1999-
NB (DB) in E/A Nos. I2I7/96-NB, 498/97-NB, 583, 584, 585/97-NB, 1835/
97-NB, 193/98-NB and 302/98-NB.
WITH
B
c
C.A. Nos. 590-591, 599, 420, 627, 653, 654, 674, 897-898, 899-900,
901, 819, 818, 799, 806, 816, 817, 874, 873, 872, 842, 1082, 1085, 1114,
1117, 1118, 1463, 1464 of 2000 S.L.P. (C) No.2954/2000, C.A. Nos.1896,
1895, 1812, 1785, 1784, 1532, 1962, 1963, 1964, 2000-2001, 2051, 2156, D
2157, 2210, 2220 of2000, S.L.P. (C) No.5450/2000, C.A. Nos.2197, 2196,
2132,2131,2308,2303-04,2306-2307,2342,2309,2385,2386,2407-2409,
2419, 2418, 2417, 2410, 2420, 2553, 2539-2544, 2545, 2538, 2554, 2552,
2537, 2606, 2607, 2387, 2626-2628, 2669-2670, 2671, 2674, 2668, 2667,
2666, 2673, 2707, 2750, 2744, 2749, 2582, 2890, 2748, 2891-2894, 2899, E
2907-2921, 2906, 2905, 2902-2904, 2978, 3001-3004, 3063, 3074, 3075,
3062, 3560, 2929, 3292, 3276-3282, 2275 3168-3169, 3522-3529, 3439-
3440, 3537, 3540, 3547, 3543-3544, 3588, 3630, 3637, 3633, 3636, 3629,
3551, 3707-3708, 3701-3702, 3713-3718, 3720-3725, 3828, 4290 of 2000,
S.L.P. (C) No.11676/2000, C.A. Nos.4208, 4254-4260, 4289, 4559, 4616,
4513-4514, 4486, 4511, 4821, 4742, 4779, 4766, 4943, 5315, 5555, 5659, F
5522, 5832, 5155-5162, 5971-5973, 5633-5634, 5978, 6077, 2944, 6459,
6581, 6578-6579, 6871, 7164 of2000, C.A. Nos. 304, 285-289, 748 of2001,
S.L.P. {C) No.190112001, C.A. Nos.1261, 1495-1497, 2997-2998 of 2001,
3427-3428 of 2000, 3855 of 2001 and CA No.02801/2000.
Soli J. Sorabjee, Attorney General, Harish N. Salve, Solicitor General,
R.N. Trivedi, Mukul Rohtagi, Additional Solicitor Generals, Sudhir Chandra,
Ranjit Kumar, Joseph Vellapally, N.K. Bajpai, K. Swami, Ms. Nisha Bagchi,
G
Ms. Smitha Inna, K.C. Kaushik, R.N. Poddar, Rajiv Nanda, B.K. Prasad,
Rana Mukherjee, Ms. Sumita Mukherjee, P.K. Ganguly, V. Lakshmikumaran,
M.P. Devanath, B.L. Narasimhan, V. Balachandran, Rajesh Kumar, Balbir H
60
SUPREME COURT REPORTS [2001] SUPP. I S.C.R.
A Singh, Dayan Krishnan, Nikhil Nayyar, Trideep Pais, Ms. Meenakshi Arora,
H.K. Puri, S.K. Puri, Rajesh Srivastava, UJExcerpt shown. Read the full judgment & AI analysis in Lexace.