Full Judgment
(ii) Transformer does not fall under the Category of machine, machinery, plant and equipment and is not part of plant, which is used in producing, processing or bringing out any change in any goods. The use is only to regularise electricity supply and it does not take part in producing or processing goods.
(iii) Transformer received prior to 16-3-1995 and transformer only with cables, etc., was not held to be capital goods by Tribunal in the case of M/s. Jam Shri Ranjit Singh Spinning and Weaving Co. Ltd. vide order No. 1274/96-WRB. Hence this appeal.
2. Heard the learned DR and considered the submission made in writing vide letter dated 25-8-2003 of the Respondent intimating they cannot attend the hearing or afford to engage a representative. Thus submission made should be considered. The adjournment sought is registered. I proceed to decide the issue.
(a) The amount involved is Rs. 14,575/- availed as credit and Rs. 5,000/- as penalty.
(b) The issue of eligibility under Rule 57Q has been finally settled by the Apex Court in the case of Commissioner of CCE, Coimbatore v. Jawahar Mills Ltd. [2001 (132) E.L.T. 3 (S.C.)]. In this decision the court laid down :- "6......We have no difficulty in accepting the contention of the learned Additional Solicitor General that, under these circum stances, user will determine whether an item qualifies or not the requirement of Clause 1(a)..." Therefore, it was not for the Revenue to go and determine the qualification of the item. It has to be left to the "User" who keeping in mind the technology used and the commercial expediency would bring in a particular machine or/and set of machines to his factory for manufacture of the final product.
(c) Transformers are admittedly bringing in a charge in the Electric Supply and there use is to be determined by the manufacturer. No commercial manufacture will be effected enrolled for machine.
(d) Transformers have been specifically hold to be eligible goods (see Nahar Spinning Mills - 1998 (97) E.L.T. 127 in light of the law laid down by the Apex Court, Tribunal decisions to the effect of denying credit on transformers are no longer good law.
(e) The ground of limited application of the word 'plant' taken in that appeal is not upheld in view of the decision in the case of Valley Abrasives Ltd. - 1997 (91) E.L.T. 700 (para 6).
(f) The transformers received prior to amendment of Rule 57Q with effect from 16-3-95 would be eligible in view of CCE v. Nav Bharat Paper Mills [1996 (86) E.L.T. 501 (para 6)] and 1997 (92) E.L.T. 276 (para 6) of CCE v. R.K. Marbles Ltd. (g) The reliance on Shanmugaraja Spinning Mills Pvt. Ltd, - 1997 (89) E.L.T. 84 by Revenue is not well placed in view of the decision in the case of Nahar Spinning Mills - 1998 (97) E.L.T. 127 and Birla Ericson Opticals Ltd. - 1998 (100) E.L.T. 498.
3. In view of the findings herein, no valid grounds exist to entertain this appeal filed by Revenue. The Revenue appeal is therefore required to be rejected.