Transitional proforma credit under amended excise rules survives only if it was already allowable before the statutory commencement date.

Transitional proforma credit under Rule 56A(8) of the Central Excise Rules, 1944 was available only where the credit had already been allowable under the rule immediately before commencement of the Central Excise Tariff Act, 1985. On that construction, benefit claimed under rescinded Notification No. 201/79 did not survive the amended scheme introduced from 1-3-1986, because the amended provision did not expressly preserve such credit. The earlier contrary understanding was treated as not binding on the facts, and the view that the rescinded notification continued the benefit was rejected as per incuriam.

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Issues: (i) Whether the appellant was entitled to continue availing proforma credit under Rule 56A(8) of the Central Excise Rules, 1944 after rescission of Notification No. 201/79 and in light of the amended scheme brought in on 1-3-1986.

Issue (i): Whether the appellant was entitled to continue availing proforma credit under Rule 56A(8) of the Central Excise Rules, 1944 after rescission of Notification No. 201/79 and in light of the amended scheme brought in on 1-3-1986.

Analysis: The majority held that the amended sub-rule protected only those credits that were allowable under Rule 56A immediately before the commencement of the Central Excise Tariff Act, 1985. On that construction, the appellant had not been entitled to credit under Rule 56A before the relevant commencement date, and the benefit claimed through the rescinded notification did not survive under the amended provision. The decision relied on the later, correct form of Rule 56A(8) and treated the earlier contrary view as not binding in the facts of the case.

Conclusion: The appellant was not entitled to the credit claimed, and the issue was decided against the assessee.

Final Conclusion: The appeal failed on the controlling interpretation of Rule 56A(8), and the order of the lower authorities was sustained.

Concurring/Dissenting Opinion: The Technical Member, supported by the President's majority view, held that the appellant could not rely on the earlier understanding of Rule 56A(8); the contrary view treating the prior Tribunal decision as applicable was rejected as per incuriam.

Ratio Decidendi: Transitional credit under an amended excise rule is available only if the credit was already allowable under the rule as it stood immediately before the relevant statutory commencement, and a rescinded notification does not continue the benefit unless the amended provision expressly preserves it.

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