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of <h1>Tribunal rules on Modvat credit for car duty payment & similarity with commercial vehicles</h1> The Tribunal dismissed the application concerning the use of Modvat credit for duty payment on cars and the similarity between cars and commercial ... Reference to High Court - Modvat Issues involved:1. Whether Modvat credit for inputs used in manufacturing commercial vehicles can be used for duty payment on cars.2. Whether cars and commercial vehicles can be considered similar products.Issue 1:The appellant claimed Modvat credit for duty paid on inputs used in manufacturing commercial vehicles and used the balance credits for duty payment on cars. The Commissioner disallowed this, leading to an appeal before the Tribunal. The Tribunal did not address whether duty paid on inputs not used in manufacturing cars can be used for car duty payment. The Tribunal's decision did not challenge the Commissioner's conclusion, and the question was deemed not arising from the Tribunal's order.Issue 2:The Departmental Representative argued that cars and commercial vehicles are dissimilar based on function, design, appearance, and use. Citing precedents, the Representative contended that the Tribunal's reliance on certain cases was misplaced. The Supreme Court's interpretation in previous cases indicated that the term 'similar' does not mean identical but corresponding or resembling in many respects. The Tribunal's decision aligns with the Supreme Court's view on the scope of 'similar.' The Tribunal found that cars and commercial vehicles operate on similar principles of engineering and technology, differing mainly in size and capacity. The reliance on Customs Valuation Rules' definitions by the Department was considered misplaced. Ultimately, the Tribunal's decision regarding the similarity of vehicles was upheld, and no reference to the High Court was deemed necessary.Conclusion:The Tribunal dismissed the application based on the findings related to the Modvat credit issue and the similarity of cars and commercial vehicles.
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