Modvat credit on furnace oil remained capped at 10% because Rule 57B did not override the Rule 57A notification.

Rule 57B credit on furnace oil remained subject to the restriction in Notification No. 14/97-C.E. (N.T.) because Rule 57B, though containing a non obstante clause, operated within the framework of Rule 57A. Since Rule 57B did not independently specify the duty, the meaning of "specified duty" had to be traced to the Rule 57A notification, and the 10% ad valorem cap continued to apply. Full Modvat credit on furnace oil was therefore not available.

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Issues: Whether the restriction of Modvat credit on furnace oil to 10% under Notification No. 14/97-C.E. (N.T.) applied to credit claimed under Rule 57B of the Central Excise Rules, 1944.

Analysis: Rule 57A governed specified inputs, specified final products, specified duty and any restrictions on credit. Rule 57B contained a non obstante clause, but its operation was confined to the field of inputs and the explanation linked the expression "inputs" to the notification issued under Rule 57A. Since Rule 57B did not itself specify the duty, the concept of "specified duty" had to be traced back to Rule 57A and the notification issued thereunder. On that reading, the restriction in Notification No. 14/97-C.E. (N.T.) limiting credit to 10% ad valorem continued to apply.

Conclusion: The restriction to 10% was applicable, and the appellants were not entitled to full Modvat credit on furnace oil.

Final Conclusion: The appeals failed because the credit claim under Rule 57B remained subject to the restriction imposed through the notification issued under Rule 57A.

Ratio Decidendi: Where Rule 57B refers to specified duty but does not independently specify that duty, the governing restriction in the notification issued under Rule 57A continues to apply notwithstanding the non obstante clause in Rule 57B.

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