Modvat credit on air-conditioners denied after exclusion under Rule 57Q came into force.

Air-conditioners were excluded from Modvat credit under Rule 57Q by Notification No. 11/95-C.E. (N.T.) dated 16-3-1995, so credit taken after that date was not available on such goods. Because the goods were received and the credit was availed only after the exclusion had come into force, the goods did not qualify for Modvat credit. The result was that the credit claim was rejected and the appeal failed.

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Issues: Whether Modvat credit on air-conditioners was admissible when the goods were received and credit was taken after their exclusion from the scope of Rule 57Q.

Analysis: Air-conditioners had been specifically excluded from the purview of Modvat credit under Rule 57Q by Notification No. 11/95-C.E. (N.T.) dated 16-3-1995. The credit in question was availed only after that date, and the exclusion operated against eligibility for credit on such goods.

Conclusion: The credit was not admissible and the appeal failed.

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