Retrospective notification benefit unavailable where no express or implied backward effect was shown, denying Modvat credit on imported inputs.

Retrospective operation of Notification No. 96/2004-Cus. was not available because the text of the notification showed effect only up to 31 March 2005 and did not express, or by necessary implication permit, backward application. Since retrospective intent must be clear from the provision itself, the benefit could not be extended to imported inputs on which countervailing duty was paid through DEPB debit rather than in cash. The respondents were therefore not entitled to claim retrospective benefit of the notification or Modvat credit of CVD on those inputs.

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Issues: Whether Notification No. 96/2004-Cus. could be given retrospective effect so as to permit Modvat credit of countervailing duty on imported inputs where the duty had been paid through DEPB debit and not in cash.

Analysis: The entitlement to credit depended on whether the later notification operated retrospectively. The notification itself stated that it would have effect only upto and inclusive of 31 March 2005, and did not indicate retrospective operation either expressly or by necessary implication. A provision can be treated as retrospective only when such intention is shown in the text or by necessary implication. In the absence of such indication, the benefit could not be extended backwards.

Conclusion: The respondents were not entitled to claim retrospective benefit of the notification and were not eligible to take Modvat credit of CVD on the imported inputs.

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