Modvat credit on provisional invoices sustained where inputs were received, duty paid, and used in manufacture; Rule 57G(11) treated as clarificatory.

Modvat credit may be sustained on the basis of provisional invoices where the inputs are shown to have been received, duty paid, and used in manufacture. Rule 57G(11) of the Central Excise Rules, 1944 was treated as a clarificatory provision intended to resolve earlier disputes and align with the scheme of the Modvat Credit Rules. On that footing, the appellate order allowing credit was found unobjectionable, and the challenge to the grant of credit failed.

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Issues: Whether Modvat credit could be sustained on the basis of provisional invoices and whether Rule 57G(11) of the Central Excise Rules, 1944 operated as a clarificatory provision without retrospective difficulty.

Analysis: The inputs were not disputed to have been received, duty paid, and used in the manufacture of the final product. Rule 57G(11) was treated as clarificatory in nature, intended to address prior disputes and to accord with the scheme and spirit of the Modvat Credit Rules. On that basis, the Tribunal found no infirmity in the appellate order allowing credit.

Conclusion: The credit was rightly allowed and the challenge to its grant failed.

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