Transitional Modvat credit and Rule 57H declaration requirement remained unsettled, making the dispute a referable question of law.

Conflicting Tribunal views existed on whether transitional Modvat credit for inputs lying in stock on the date of filing a Rule 57G declaration required a separate declaration under Rule 57H(1)(A), or whether disclosure in the Rule 57G declaration was sufficient. Some decisions treated separate prior permission as unnecessary where duty-paid character and stock position were verifiable, while others read Rule 57H as requiring a distinct application. Because the legal position was unsettled, the Tribunal treated the issue as an arguable question of law and held that it was referable to the High Court; the Modvat entitlement on merits was not decided.

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Issues: Whether a separate declaration of inputs was required under Rule 57H(1)(A) for availing Modvat credit on inputs lying in stock on the date of filing the Rule 57G declaration, or whether disclosure in the Rule 57G declaration itself was sufficient, and whether the matter raised a fit question of law for reference.

Analysis: The record showed conflicting Tribunal views on the necessity of a separate request under Rule 57H(1)(A) for transitional Modvat credit on stock lying in the factory before the dated acknowledgement under Rule 57G. Some decisions indicated that prior permission was not essential if the duty-paid character of the inputs and stock position were verifiable, while others suggested that an application under Rule 57H was contemplated. In view of this divergence, the Tribunal treated the matter as involving an arguable question of law rather than a settled proposition.

Conclusion: A separate declaration under Rule 57H(1)(A) was held to raise a referable question of law, and the reference application was allowed to proceed to the jurisdictional High Court.

Final Conclusion: The Tribunal did not decide the Modvat entitlement on merits but concluded that the dispute warranted reference because the legal position on the requirement of a separate Rule 57H declaration was unsettled.

Ratio Decidendi: Where conflicting Tribunal decisions exist on the procedural requirement for transitional Modvat credit, the issue constitutes a referable question of law for the High Court.

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