| Date: |
22-10-1997
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| Notification No: |
Central Excise Circular No 344/1997
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| Issuing Authority: |
Central Excise
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| Type: |
Circular
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| File No: |
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| Subject: |
Regarding denial of Modvat credit on Transformer Oil
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Regarding denial of Modvat credit on Transformer Oil
Circular No. 344 dated 22nd October 1997
1. Representations have been received from the Trade regarding denial of Modvat Credit on Transformer Oil used in the manufacture of transformers on the ground that the said item can not be treated as an input under Rule 57A of Central Excise Rules, 1944.
2. The matter has been examined in the Board. As the the transformer can not function without transformer oil, the manufacturer of transformer can not be treated as complete without transformer oil filled into it. Moreover the transformer oil acts as a coolant which is vital to functioning of the transformers.
3. I am directed to say that Modvat Credit under Rule 57A of Central Excise Rules is admissible on transformer oil whose value is included in the value of the final product and it is contained in the transformers at the time of clearance from the factory.
4. All pending disputes may be decided accordingly.
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