Modvat credit on inputs for non-exempt final goods was allowable, and no referable question of law arose.

Modvat credit is allowable on inputs used in manufacturing a final product that is not exempt from excise duty under Rule 57C of the Central Excise Rules, 1944, so credit taken for inputs used in tyre bead wire manufacture was properly admissible. Because the statutory position was clear and the final product was not exempt, no referable question of law arose for reference under Section 35H(1) of the Central Excise Act, 1944, and the request for reference was not maintainable.

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Issues: Whether the respondent was entitled to Modvat credit on inputs used in the manufacture of tyre bead wire when the final product was not exempt from excise duty, and whether any referable question of law arose for reference under Section 35H(1) of the Central Excise Act, 1944.

Analysis: Rule 57C of the Central Excise Rules, 1944 permits Modvat credit on inputs where the final product is not exempt from payment of excise duty. The bead wire manufactured by the respondent was not an exempt item, so the credit taken on inputs used in its manufacture was allowable. In view of this clear statutory position, no referable question of law arose from the Tribunal's order.

Conclusion: The respondent was entitled to Modvat credit and the request for reference was not maintainable.

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