Deemed Modvat credit remained available to an SSI unit after crossing the exemption slab, despite full-rate duty payment.

Deemed Modvat credit was treated as continuing to be available to an SSI unit even after its clearances crossed the exemption slab under Notification No. 1/93, provided duty was paid at the full rate. The Tribunal followed earlier decisions on the same legal question and applied the same position to connected matters with identical facts. The operative effect was that crossing the Rs. 75 lakhs limit did not, by itself, deprive the unit of deemed credit, and the Revenue's challenge failed.

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Issues: Whether deemed Modvat credit remained admissible to an SSI unit after it crossed the clearances limit of Rs. 75 lakhs under Notification No. 1/93.

Analysis: The Tribunal treated the question as settled by earlier decisions holding that deemed credit under the relevant Ministry of Finance order continued to be available to SSI units even after crossing the exemption slab, once duty was paid at the full rate. The same view had also been followed in later connected matters involving identical facts and the same legal question.

Conclusion: The benefit of deemed Modvat credit was admissible even after crossing the Rs. 75 lakhs limit, and the Revenue's challenge failed.

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