Limitation for Modvat credit recovery under excise rules versus Section 11A was referred to the Supreme Court.

The commentary addresses whether, before the 6-10-1988 amendment, Rule 57-I of the Central Excise Rules was governed by the six-month limitation in Section 11A of the Central Excises and Salt Act, 1944, or whether Modvat credit could be recovered independently under Rule 57A beyond that period. The legal issue concerns the relationship between the credit recovery machinery under the Rules and the statutory limitation period for excise demands. The matter was referred to the Supreme Court for determination of this question of law.

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Issues: Whether Rule 57-I of the Central Excise Rules, as it stood prior to amendment on 6-10-1988, was subject to the limitation under Section 11A of the Central Excises and Salt Act, 1944, or whether Rule 57A operated independently so as to permit recovery of Modvat credit beyond six months before 6-10-1988.

Outcome: The matter was referred to the Supreme Court for determination of the question of law.

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