Modvat credit notification interpretation: specified Chapter 27 inputs only, with Residual Fuel Oil excluded and no interference warranted.

Notification No. 14 of 1997 under Rule 57A of the Central Excise Rules, 1944 limited Modvat credit to specified Chapter 27 inputs such as naphtha, furnace oil, low sulphur heavy stock, light diesel oil, bitumen and paraffin wax. On a plain reading, Residual Fuel Oil was outside the notified items, and the finding that Low Sulphur Heavy Stock was not covered by the notification was based on the text itself. No substantial question of law arose, and no interference was warranted with the view against the assessee.

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Issues: Whether a substantial question of law arose on the applicability of Notification No. 14 of 1997 to Residual Fuel Oil and Low Sulphur Heavy Stock, and whether Low Sulphur Heavy Stock was covered by the notification for the purpose of Modvat credit and duty rate.

Analysis: The notification, issued under Rule 57A of the Central Excise Rules, 1944, restricted credit in respect of specified inputs, namely naphtha, furnace oil, low sulphur heavy stock, light diesel oil, bitumen and paraffin wax falling under Chapter 27 of the Schedule to the Central Excise Tariff Act, 1985. On a plain reading, Residual Fuel Oil did not fall within the specified items. The Tribunal's view that Low Sulphur Heavy Stock was not covered by Notification No. 14 of 1997 was based on the text of the notification, and the court found no error warranting interference.

Conclusion: No substantial question of law arose. The reference was not entertained for interference, and the view against the assessee was sustained.

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