{"id":94492,"date":"1996-11-19T00:00:00","date_gmt":"1996-11-18T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/vbc-inds-ltd-vs-commissioner-of-c-ex-on-19-november-1996"},"modified":"2016-04-13T13:10:37","modified_gmt":"2016-04-13T07:40:37","slug":"vbc-inds-ltd-vs-commissioner-of-c-ex-on-19-november-1996","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/vbc-inds-ltd-vs-commissioner-of-c-ex-on-19-november-1996","title":{"rendered":"Vbc Inds. Ltd. vs Commissioner Of C. Ex. on 19 November, 1996"},"content":{"rendered":"<div class=\"docsource_main\">Customs, Excise and Gold Tribunal &#8211; Tamil Nadu<\/div>\n<div class=\"doc_title\">Vbc Inds. Ltd. vs Commissioner Of C. Ex. on 19 November, 1996<\/div>\n<div class=\"doc_citations\">Equivalent citations: 1997 (91) ELT 666 Tri Chennai<\/div>\n<\/p>\n<pre><\/pre>\n<p>ORDER<\/p>\n<p>V.P. Gulati, Vice President<\/p>\n<p>1. The issue in the appeal relates to grant of Modvat credit in respect of the following : &#8211;\n<\/p>\n<p>(i) Silica gel<\/p>\n<p>(ii) Coating oil<\/p>\n<p>(iii) Platinum rhodium catalyst<\/p>\n<p>2. The learned Counsel has pleaded that the appellants manufactured nitric acid and ammonium nitrate. For the manufacture of nitric acid they extract nitrous oxide from air. The air is run through the system for the necessary production of the nitric acid and the same has to be in dry form. Silica gel is spread throughout the passage of the air in the manufacturing stream and it absorbs the moisture from the air. The use of the same is a technical necessity. The coating oil is used to coat the ammonium nitrate prills before they are cleared out of the factory. The coating of the oil prevents the prills from forming into lumps. Platinum rhodium catalyst, as the very name suggested, helps in the promotion of the reaction for the production of nitric acid. He cited the decision of Larger Bench reported in 1996 (86) E.L.T. 613.\n<\/p>\n<p>3. Heard the learned DR.\n<\/p>\n<p>4. We observe that the use of silica gel is a technical necessity and since it helps in drying the air. The air which is taken in the manufacturing stream has to be dried. The air in the present case is a raw material and nitrous oxide is extracted therefrom. In view of what has been explained, we hold that the Modvat credit would be available in respect of this item.\n<\/p>\n<p>5. It was pleaded that the coating oil does not participate as such in the manufacture of ammonium nitrate but the same is used for the coating of ammonium nitrate prills to prevent them from forming into lumps and the use of the same is therefore to render the goods fit for marketing. Supreme Court has held that in the case of use of name plate on the product before it is cleared from the factory is to be taken to be in or in relation to the manufacture of the product. In the present case, the use of the oil is to keep the goods in the marketable form. We hold that the appellants are eligible to the benefit of Modvat credit. In regard to platinum rhodium catalyst, as the very name suggests, that it participates in the reaction as a promoter of the reaction while retaining its identity. The Larger Bench has held in case referred to supra that use of items like felts, wires, etc. in the paper machine would be in or in relation to the manufacture of the finished product and the benefit of Modvat credit would be available. In the present case, since the use of the material is a technical necessity and which is not notified in the excluded categories of items under Rule 57A, the benefit would be available. We therefore accordingly allow the appeal.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Customs, Excise and Gold Tribunal &#8211; Tamil Nadu Vbc Inds. Ltd. vs Commissioner Of C. Ex. on 19 November, 1996 Equivalent citations: 1997 (91) ELT 666 Tri Chennai ORDER V.P. Gulati, Vice President 1. The issue in the appeal relates to grant of Modvat credit in respect of the following : &#8211; (i) Silica gel [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-94492","post","type-post","status-publish","format-standard","hentry","category-judgements"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Vbc Inds. Ltd. vs Commissioner Of C. 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