Judgment :- R. JAYASIMHA BABU, J. The issue requiring our consideration is as to whether Modvat credit is available to a manufacturer in this case a manufacturer of Viscose Rayon in respect of the wires and cables which are used for the transmission of the electrical energy from the Sub Station within the premises of the manufacturer to the blowers which are used to take out Sulphur dioxide gas generated in the manufacturing process employed in the factory, unless that noxious gas is removed, it will not be possible for the workmen to continue to work within the premises of the factory, as the gas is generated in the process of manufacture, the workmen being engaged in operating, the machines employed in that process. 2.The Modvat credit so claimed was not granted on the ground that those wires and cables are not used in the process of manufacture and, therefore, do not constitute capital goods for the purpose of Rule 57Q of the Central Excise Rules, as it stood in the year 1994. Though the Commissioner had allowed the appeal of the assessee, the Tribunal restored the order of the assessing authority denying the Modvat credit. The manufacturer-assessee has, therefore brought this reference before us. 3.The Modvat scheme was introduced in the Excise Law in the year 1986. It was initially confined to the inputs used in the manufacture of the specified excisable final products, till the year 1994. The goods which were excluded from that category of inputs by and large were allowed Modvat credit in 1994 by extending the scheme to capital goods, which were till then ineligible for Modvat credit. The excisable goods used as inputs under Rule 57Q which occurs in Chapter AAAA. Credit of duty paid on capital goods used by the manufacturer of specified goods, was introduced in the year 1994. The object of the Rule is to allow credit of specified duty paid on the capital goods used by the manufacturer in his factory, and for utilising the credit so allowed towards payment of duty of excise leviable on the final products, subject to the conditions set out in the Rule. "Capital Goods" is defined in the Explanation to Rule 57Q(1). "Capital Goods" is defined in the Explanation to Rule 57Q(1). That definition as it stood in the year 1994 read as under:"Capital"(1) Goods "means - (a)machines, machinery, plant, equipment, apparatus, tools or appliances used for producing or processing of any goods or for bringing about any change in any substance for the manufacture of final products; (b)components, spare parts and accessories of the aforesaid machines, machinery plant, equipment, apparatus, tools or appliances used for aforesaid purpose; and (c)moulds and dies, generating sets and weigh-bridges used in the factory of the manufacturer." 4.It is the case of the applicant manufacturer that wires and cables in respect of which the Modvat credit was claimed, fall within the scope of the term "plant" used in Clause (a) of the definition of "Capital goods" in the Explanation to Rule 57Q. The submission is that the word "plant", though found in association with machines, machinery, equipment, apparatus, tools or appliances must be given a meaning which is not already contained within the scope of the other terms used in that provision, and that the word "plant" being a word of a very wide import, is sufficiently elastic to take within its for all the installations which have a nexus with the manufacture of the final product, such nexus to be judged by the standard of the need for such installation for the manufacture of the final product. It was submitted that in order to be regarded as capital goods, the goods in question need not have a direct role in bringing about the change in the raw material, and that the installations which are required, to make the machineries usable for being employed in the process of manufacture would also be covered, so long as such installation can be regarded as "goods". Buildings, however, would not come within the scope of "plant", as that expression has been used herein the context of capital goods, and buildings cannot be regarded as goods. Buildings, however, would not come within the scope of "plant", as that expression has been used herein the context of capital goods, and buildings cannot be regarded as goods. The fact that the wires and cables are used for providing the electrical supply to the blowers and the blowers in turn are used for removing the noxious gas generated in the process of manufacture, would be sufficient to establish the nexus between those items and the manufacture of the final product, as without the aid of these items, work cannot go on in the factory as workmen would be unable to continue to be present in the factory premises and continue to work on the machines which are used in a process which results in the generation of the noxious gas. Such blowers are necessary to protect the health and safety of the workmen. 5.The requirement in the definition which is an exhaustive definition that the "capital goods" referred to in the definition, be used for producing or processing or for bringing about any change in any substance for the manufacture of the final product, it was submitted, is satisfied, as the cables are used for running the blowers without which the process of production cannot continue. The words used for producing or processing, it was submitted, does not imply that the user must be direct, and that it cannot be indirect. Wires and cables required for bringing the electrical power to run the machinery and apparatus and appliances which are used in the production or processing is also used for producing or processing the goods, as in the absence of such cables, power cannot be supplied to the machines and appliances and without the aid of power, those machines and appliances cannot be used for any purpose whatsoever. 6.Mr. Arvind P. Datar, learned Senior Counsel for the manufacturer also drew our attention to the decision of the Supreme Court in the case of J.K. Cotton Spinning and Weaving Mills Co. Ltd. v. Sales Tax Officer, Kanpur wherein, the Court observed at paragraph 12 that electrical humidifier, exhaust fans and similar electrical equipment would in the modern conditions of technological development normally be regarded as equipment necessary to effectually carry on the manufacturing process. While so observing, the Court excluded items such as fans, coolers, air-conditioning units. Ltd. v. Sales Tax Officer, Kanpur wherein, the Court observed at paragraph 12 that electrical humidifier, exhaust fans and similar electrical equipment would in the modern conditions of technological development normally be regarded as equipment necessary to effectually carry on the manufacturing process. While so observing, the Court excluded items such as fans, coolers, air-conditioning units. Though that case was one which arose under the Sales Tax Act, the expression considered was in the manufacture. That expression, the Court held, took within it's compass, all processes which are directly related to the actual production. The Court also observed that if the process or activity is so integrally related to the ultimate manufacture of goods, so that without that process or activity manufacture may, even if theoretically possible, by commercially inexpedient, goods used for those purposes would qualify as things used in the manufacture. 7.Reference was also made by counsel to the case of Collector of Central Excise v. Rajasthan State Chemical Works, wherein, it was held that if any operation in the course of manufacture is so integrally connected with the further operations which result in the emergence of manufactured goods, the entire process must be regarded as one continuous stream. 8.It was also pointed out by counsel that in the initial years after the extension of the Modvat credit to capital goods, there was considerable ambiguity in the manner in which the definition was to be understood and applied, and that, subsequently that ambiguity has been cleared by the rule-making authority itself which has by the subsequent amendments, made it amply clear that wires and cables are not to be regarded as excluded from the category of "capital goods". 9.Counsel also invited the attention of the court to the decision of the Supreme Court in the case of Rohit Pulp and Paper Mills Ltd. v. Collector of Central Excise, Baroda, where, the court considered the maxim "noscitur a sociis", which as explained by the court means that the meaning of the word is to be judged by the company it keeps. Counsel relied on that principle to contend that the word "plant" must like all other items used in the definition clause in Sub Clause (a) must be taken to refer to things which are used in the manufacture of the goods. Counsel relied on that principle to contend that the word "plant" must like all other items used in the definition clause in Sub Clause (a) must be taken to refer to things which are used in the manufacture of the goods. Counsel submitted that machines cannot run by themselves and the prime mover required for running the machine is the electrical energy which must necessarily be brought to the place where the machines are kept, and that the wires and cables required for bringing that energy are essential for the process of manufacture and would fall within the scope of the term "plant". 10.Mr. V.T. Gopalan, Learned Additional Solicitor General appearing for the Revenue submitted that in Economic Legislation the court is only required to consider the legislative intent as disclosed in the Legislation under consideration, and considerations of equity removal of inconsistency cannot come in the way of the legislative intent being effectuated. It was submitted that the fact that the Rule was subsequently amended would only indicate that until such amendment, the benefit subsequently given could not have been claimed prior to the amendment. Counsel also laid stress on the definition of "capital goods" and pointed out that the definition is an exhaustive one, and to such a definition no additions could be made to widen the scope of the term "capital goods". 11.It was also submitted by the learned Additional Solicitor General that the word "plant" though a word of wide import, cannot be construed in it's widest amplitude in all contexts and in all statutes, and that unlike in the Income-tax Act which has a definition of the word "plant" which is an inclusive definition, that term has not been defined in the Excise Act, or Rules. The meaning to be assigned to the term must, therefore, be gathered having regard to the object and purpose of the scheme, the context in which the term is employed, and the purpose for which that term has been used in the Rule. Counsel also said that the observation made by courts while interpreting statutory provisions contained in other enactments, would have no bearing in determining the meaning to be assigned to a word used in the Excise Rules. Counsel also said that the observation made by courts while interpreting statutory provisions contained in other enactments, would have no bearing in determining the meaning to be assigned to a word used in the Excise Rules. 12.Attention was invited by counsel to the decision of the Supreme Court in the case of State of Bihar v. Steel City Beverages Ltd. [ 1999 1 SCC 10 ], wherein, the court observed at paragraph 5 as under : "Therefore, what we have to consider is whether under the Deferment Rules "plant" would include bottle and crates employed by an industrial unit manufacturing soft drinks and beverages for carrying on its business. The word plant has a very wide meaning and a variety of articles, objects or things have been held to be plant. Dictionaries have defined plant as land, building, fixtures, machinery, implements and tolls, and apparatus used in carrying on a mechanical operation or an industrial process. This Court in the case of Commissioner of Income Tax v. Taj Mahal Hotel, and Scientific Engineering House (P) Ltd. v. Commissioner of Income-tax referred to with approval the observations of Lindley, L.J. in Yarmouth v. France [1887 19 QBD 647] that in its ordinary sense plant includes whatever apparatus is used by a business, man for carrying on his business, not his stock in-trade which he buys or makes for sale, but all goods and chattels, fixed or moveable, live or dead, which he keeps for permanent employment in his business." The court, after having noticed that the term "plant" was a term of wide import by itself, held that such a wide meaning cannot be assigned to the word "plant" ignoring the context in which the term had been employed, and the purpose of the statute in which that provision is found. Having regard to the language of the Rule made under the Sales Tax Act which was under consideration in that case, the Court held that, that word was not used in it's wider sense and did not include within it's meaning land, building and machinery. It held that the crates and bottles used for storing the beverages manufactured by the respondent before it could not be regarded as plant. It held that the crates and bottles used for storing the beverages manufactured by the respondent before it could not be regarded as plant. 13.Reliance was also placed on the recent decision of the Supreme Court in the case of C.I.T., Trivandrum v. Anand Theatres, wherein, the court inter alia observed that the meaning to be assigned to the word "plant" in the context of the scheme of Section 32 of the Income-tax Act was not to be dependant upon the meaning given in other judgments in relation to the term in other contexts. The court quoted with approval the observations of the Court in the case of Deputy Chief Controller of Imports and Exports v. K.T. Kosalram. The passage quoted runs as under :- "In our opinion dictionary meanings, however helpful in understanding the general sense of the words cannot control where the scheme of the statute or the instrument considered as a whole clearly conveys a somewhat different shade of meaning. It is not always a safe way to construe a statute or a contract by dividing it by a process of etymological dissection and after separating words from their context to give each word some particular definition given by lexicographers and then to reconstruct the instrument upon the basis of these definitions. What particular meaning should be attached to words and phrases in a given instrument is usually to be gathered from the context, the nature of the subject-matter, the purpose or the intention of the author and the effect of giving to them one or the other permissible meaning on the object to be achieved. Words are after all used merely as a vehicle to convey the idea of the speaker or the writer and the words have naturally, therefore, to be so construed as to fit in with the idea which emerges on a consideration of the entire context". 14.The meaning to be assigned to the word "plant" in the definition of "capital goods" in Rule 57Q of the Rules must, therefore, necessarily be in accord with the scope and purpose of the Rule, the context in which the term had been employed, and the object that it seeks to achieve. 15.The object of the Rule is to extend the facility of Modvat credit to capital goods used by a manufacturer of specified goods. 15.The object of the Rule is to extend the facility of Modvat credit to capital goods used by a manufacturer of specified goods. The person claiming benefit must first be a manufacturer, and second, he must be engaged in the manufacture of specified goods. The term "goods" by definition excludes certain fixed assets like lands and buildings. The term "capital goods" in Rule 57Q, however, widely construed cannot take within it's scope lands and buildings. The manufacturer claiming the benefit is required to show that the goods in respect of which the credit is claimed falls within the category of "Capital Goods". "Capital Goods" used in Rule 57Q is in contrast to Rule 57A, which deals with the inputs which are used in or in relation to the manufacture of the final product. Things which properly fall within the scope of Rule 57A are necessarily excluded from the scope of Rule 57Q. The inputs as also the final products are 'goods'. It is only 'goods' which are capable of being regarded as capital goods - things which are movables - that are covered by Rule 57Q when such movables are capital goods. Capital goods in the context of Modvat scheme are necessarily excisable goods and are themselves the result of manufacture. 16.The term "manufacture" has been defined in Section 2(f) of the Central Excise Act. That definition is an inclusive definition. That definition reads as under: "manufacture" includes any process, - (i)incidental or ancillary to the completion of a manufactured product; and (ii)which is specified in relation to any goods in the Section or Chapter notes of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) as amounting to manufacture. and the word "manufacturer" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacture on his own account. "17.The reference to manufacture in Rule 57Q of the Rules has thus to be understood with the meaning assigned to it in Section 2(f). That definition is not an exhaustive one, it is an inclusive one, and takes within it's scope things which may properly be regarded as manufacture, but which may not have been spelt out in the definition. "17.The reference to manufacture in Rule 57Q of the Rules has thus to be understood with the meaning assigned to it in Section 2(f). That definition is not an exhaustive one, it is an inclusive one, and takes within it's scope things which may properly be regarded as manufacture, but which may not have been spelt out in the definition. 18.The Supreme Court in the case of P. Kasilinam v. P.S.G. College of Technology made the following observations with regard to the manner in which exhaustive and inclusive definitions are to be understood :" A particular expression is often defined by the Legislature by using the word 'means' or the word 'includes'. Sometimes the word 'means and includes' are used. The use of the word 'means' indicates that "definition is a hard and fact definition, and no other meaning can be assigned to the expression than is put down in the definition." The word 'includes', when used, enlarges the meaning of the expression defined so as to comprehend not only such things as they signify according to their natural import but also those things which the clause declares that they shall include. The words 'means and includes', on the other hand, indicate an exhaustive explanation of the meaning which, for the purposes of the Act, must invariably be attached to these words or expressions ". 19.Though the definition of "capital goods", appears to be an exhaustive definition, that definition is in fact in so far as it refers to "manufacture" an inclusive one, the term "manufacture" used therein taking within It's scope all things which naturally fall within the scope of the expression "manufacture". 20.So long as the claim made by the manufacturer is in respect of the capital goods of the nature spelt out in any of the sub clauses of the defomotopm (sic) of "capital goods", and those goods are used for producing or processing of any goods, or for bringing about any change in any substance for the manufacture of the final product, such goods would be eligible for the credit provided for in Rule 57Q of the Rules subject to the excisable goods manufactured being capable of being regarded as final products for Rule 57Q(1). 21.The term "manufacture" has been interpreted by the Supreme Court in numerous decisions, and has received meanings which have not always been uniform. 21.The term "manufacture" has been interpreted by the Supreme Court in numerous decisions, and has received meanings which have not always been uniform. That is so because of the context in which the term was required to be explained and understood. "Manufacture" in the context of Excise Law has been explained by the Supreme Court in the case of Union of India v. Delhi Cloth and General Mills Co. - 1977 (1) E.L.T. (J 199) (S.C.), wherein, the constitution Bench of the court in paragraph 14 of the judgment observed :" The word "manufacture" used as a verb is generally understood to mean as " bringing into existence a new substance" and does not mean merely to produce some change in a substance, however minor in consequence the change may be. This distinction is well brought about in a passage thus quoted in Permanent Edition of Words and Phrases, Vol. 26, from an American Judgment. The passages reads thus :- Manufacture implies a change, but every change is not manufacture and yet every change of an article is the result of treatment, labour and manipulation. But something more is necessary and there must be transformation; a new and different article must emerge having a distinctive name, character or use. "22.In paragraph 18 of the judgment, the Court referred to the definition of "manufacture" in Section 2(f) of the Excise Act, and observed :" The definition of "manufacture" as in Section 2(f) puts it beyond any possibility of controversy that if power is used for any of the numerous processes that are required to turn the raw material into a finished article known to the market the clause will be applicable.......... "The Court also in that case referred to the meaning of the word "goods", which term has not been defined in the Act. After referring to the passages contained in the Words and Phrases, Permanent Edition, Vol. 18 and the definition in Webster, the Court held at paragraph 17 that," ..... to become "goods" an article must be something which can ordinarily come to the market to be bought and sold : "23.The definition of "manufacture" in Section 2(f) includes any process incidental or ancillary to the completion of a manufactured product. 18 and the definition in Webster, the Court held at paragraph 17 that," ..... to become "goods" an article must be something which can ordinarily come to the market to be bought and sold : "23.The definition of "manufacture" in Section 2(f) includes any process incidental or ancillary to the completion of a manufactured product. The "manufacture" referred to in definition of "Capital goods" in Rule 57Q must, in so far as the term "plant" is concerned, be construed as referring to all the facilities other that lands and buildings which are properly capable of being regarded as "goods" and are used directly and indirectly for producing or processing goods, or bringing about any change for the manufacture of final product. The word used in that definition is not required to be qualified further by reading in the word 'directly' into that definition. The used can be direct or indirect. So long as there is a nexus between the thing used and the production or process which is employed to manufacture the final product, the goods can be regarded as used for the purposes of this definition. 24.Thus, the definition of "capital goods" must be construed as taking within itself capital goods used directly or indirectly for the production or processing of bringing about any change for the manufacture of the final product and the term "plant" is required to be construed along with the other words used in that definition, particularly used and 'manufactured' and should be understood as taking within it's scope all things that are necessary and incidental for the production and processing which results in the manufacture of the final product. 25.Blowers which are attached to the machines which are used directly for producing the final product are essential for the operation of the machines. They are capable of being regarded as appliances under Clause (a), or as accessory under Clause (b). The wires and cables required to make the blower operational being essential, as without the supply of power the blowers cannot be run, wires and cables which carry the power to the blowers and which are undoubtedly in the nature of goods, are also required to be regarded as capital goods. 26.The fact that wires and cables have not been specifically mentioned in Clause (a) or (b) or (c) does not on that score alone imply that it was meant to be excluded. 26.The fact that wires and cables have not been specifically mentioned in Clause (a) or (b) or (c) does not on that score alone imply that it was meant to be excluded. If they can be regarded as forming part of any of the categories referred to in one or the other clauses, they are still capable of being treated as capital goods. 27.It is also necessary to keep in view the fact that this case arose in the early years of the introduction of the Modvat scheme for capital goods when there was uncertainty in the minds of all concerned as to the precise scope of the coverage. The fact that by subsequent amendments, it has been made clear that wires and cables were not meant to be excluded from the category of capital goods, would only mean that an ambiguity which existed earlier was subsequently clarified. It does not mean as was contended for the Revenue, that a concession which was not available earlier was extended for the first time by the subsequent amendment. 28.Whenever the legislature or the Rule making authority employs words of general import, certain degree of ambiguity is inevitably associated with the term so employed. The fact that the rule making authority has chosen to understand those terms in a narrow sense does not mean that that was the sense in which the rule was intended to be understood. It is for the Court to ultimately decide the true scope of the language employed in the statute having regard to the settled canons of construction governing the interpretation of statutes and statutory rules. 29.The word employed in the definition viz., "plant" being a term of wide import, the facts that it is used in the context of process of manufacture, the definition of "manufacture" is an inclusive definition in the Act; the further fact that it is found in the context of the enumerated things of a class being used; and in the absence of any specific requirement that the use should be directly in the production or processing of goods, warrant a wider meaning being assigned to the word "plant" in that definition, and not limit it only to things which directly go into the production process. It would include goods which are necessary to make that production process possible. It would include goods which are necessary to make that production process possible. Power being essential to the process, wires and cables required to bring that power to the machines, appliances, etc., are also covered by the definition of "capital goods". 30.The term "manufacture" and the words used in connection therewith such as 'use in the manufacture' or 'use in or in relation to manufacture' must, having regard to the technological advances and the progressive ideas concerning the need for ensuring the health and safety of the workmen employed in the manufacturing process, and preserving the environment and limiting the pollution, must receive an expanded meaning. This has been recognised by the Supreme Court in the case of Indian Farmers Fertiliser Co.op. Ltd. v. C.C.E., Ahmedabad. In that case, the assessee's claim that the effluent treatment plant should be regarded as part of the process of manufacture of fertilisers had been negatived by the statutory authorities. The Court at paragraph 9 observed :" It is too late in the day to take the view that the treatment of effluents from a plant is not an essential and integral part of the process of manufacture in the plant. The emphasis that has rightly been laid in recent years upon the environment and pollution control requires that all plants which emit effluents should be so equipped as to rid the effluents of dangerous properties. The apparatus used for such treatment of effluents in a plant manufacturing a particular end-product is part and parcel of the manufacturing process of that end-product".The observations of the Court with regard to the concern for environment and pollution control apply with even greater force to preservation of the health and safety of the workmen employed in a process which generates noxious gas from which the workmen need to be protected, and which gas is required to be removed simultaneously with the production of that gas for protecting the health and safety of the workmen. The blowers used for removing that gas and the wires and cables required to make that blower operational must, therefore, be regarded as forming part of the manufacturing process and used in that process. The blowers used for removing that gas and the wires and cables required to make that blower operational must, therefore, be regarded as forming part of the manufacturing process and used in that process. 31.We, therefore, answer the question referred to us at the instance of the assessee as to whether the Tribunal was correct in holding that the wires and cables are not capital goods as defined in Rule 57Q of the Central Excise Rules, in favour of the assessee, and against the Revenue. We hold that the wires and cables and covered by para 1(a) of the Explanation to Rule 57Q. So far as the question concerning the extent to which reliance can be placed on the Finance Minister's speech, we hold that that speech cannot be the guide for determining the scope of the Rule. Parties to bear their respective costs.