Proforma credit for duty-paid wrapping paper used in distribution was allowed, and alternative remedy did not bar writ relief.

Rule 56A allowed proforma credit for duty-paid wrapping paper used to facilitate the more convenient distribution of finished paper products within the same tariff framework. The benefit was not confined to use of the same duty-paid material for its own distribution, and the narrower interpretation was rejected. The objection that an alternative remedy barred writ jurisdiction was also rejected because the dispute turned on an incorrect tariff interpretation. The assessee was therefore entitled to proforma credit, and writ relief was granted.

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Issues: Whether wrapping paper, on which excise duty had already been paid, was entitled to proforma credit under Rule 56A when used for packing and more convenient distribution of other paper products; and whether the availability of an alternative remedy barred writ jurisdiction.

Analysis: Rule 56A permits credit of duty already paid on material or component parts used for the manufacture of finished excisable goods or for the more convenient distribution of the finished product, provided the duty-paid material and the finished goods fall under the relevant tariff scheme. The wrapping paper had already suffered duty and was used to facilitate the distribution of other paper products falling under the same tariff item. The narrower view that the benefit was confined to use of the same duty-paid product was rejected. The objection based on alternative remedy was also not accepted, as an incorrect interpretation of the tariff entry justified recourse to writ jurisdiction.

Conclusion: The assessee was entitled to proforma credit under Rule 56A, and the writ petition succeeded.

Ratio Decidendi: Where duty-paid wrapping material is used for the more convenient distribution of finished goods within the applicable tariff framework, proforma credit cannot be denied on the ground that the material is not used for the distribution of itself or that an alternative remedy exists.

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