Modvat credit eligibility for paper-manufacturing wire and felt referred to High Court for opinion

Eligibility of wire and felt used in paper manufacture for Modvat credit was treated as a question of law suitable for High Court opinion. The Tribunal noted its earlier view that felts and wires were inputs and that a similar issue had already been referred in another matter. Following that approach, it framed the present question of law for the jurisdictional High Court and allowed the reference application.

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Issues: Whether the question of law relating to eligibility of wire and felt used in the manufacture of paper products for Modvat credit was fit to be referred to the High Court.

Analysis: The Tribunal noted its earlier order dismissing the departmental appeal by treating felts and wires as inputs and observed that a similar question had already been referred in another matter. Following that course, it framed the present question of law for opinion of the jurisdictional High Court.

Conclusion: The reference was made to the High Court and the application was allowed.

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