Proforma credit cannot be taken twice on the same inputs; prospective withdrawal of permission was not an unlawful review.

Proforma credit under Rule 56A was denied where the same inputs had already been credited at the intermediate exempt-motor stage, because the scheme and notifications did not permit double availment at both the motor and fan stages. The authority also treated the withdrawal of earlier permission as a prospective intimation against future use, not as an impermissible review of the original order. As a result, no violation of natural justice was found, and the demand was sustained.

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Issues: (i) Whether withdrawal of permission to avail proforma credit amounted to an impermissible review of the earlier order or offended natural justice. (ii) Whether proforma credit under Rule 56A was available on electrical stampings and laminations when credit had already been availed in relation to exempt intermediate motors used in the manufacture of electric fans.

Issue (i): Whether withdrawal of permission to avail proforma credit amounted to an impermissible review of the earlier order or offended natural justice.

Analysis: An authority under a statute has no power to review its own order unless such power is conferred by the statute. The withdrawal letter was construed as a prospective intimation that the earlier permission should not be utilised in future, not as a statutory review or reopening of credit already taken. The subsequent show cause notice and adjudication afforded an opportunity to contest the demand, so no prejudice from lack of prior notice was made out.

Conclusion: The withdrawal was not an unlawful review and there was no violation of natural justice.

Issue (ii): Whether proforma credit under Rule 56A was available on electrical stampings and laminations when credit had already been availed in relation to exempt intermediate motors used in the manufacture of electric fans.

Analysis: The relevant notifications and the trade notice did not authorise double availment of credit on the same inputs at both the motor stage and the fan stage. The first proviso to sub-rule (2) of Rule 56A was applied to deny credit where the appellants had already enjoyed the benefit in relation to the intermediate exempt product. Since the motors were exempt and no duty had been paid on them, the scheme did not permit a further set-off on the finished fans.

Conclusion: The appellants were not entitled to claim proforma credit on the stampings and laminations towards duty on the fans.

Final Conclusion: The demand was sustained and the appeal failed in entirety.

Ratio Decidendi: Proforma credit under Rule 56A cannot be availed twice on the same inputs where the statutory scheme and notifications do not authorise credit at both the intermediate exempt-product stage and the finished-product stage, and a prospective withdrawal of an earlier permission is not a review order.

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