Broad meaning of "similar" goods under Modvat credit rules permits utilisation across comparable aluminium products.

Rule 57F(3) uses the term "similar" in a broad sense: it is not confined to identical goods, but extends to goods falling within the same class or category. On that construction, Modvat credit taken on inputs used for export of calcined alumina under bond could be utilised towards duty on aluminium articles, because both were treated as broadly comparable products in the same product group. The objection based on different tariff headings was rejected, and the demand was set aside with consequential relief.

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Issues: Whether Modvat credit taken on inputs used in the export of calcined alumina under bond could be utilised for duty payment on aluminium articles on the ground that the goods were "similar" within Rule 57F(3).

Analysis: The applicable principle was that the expression "similar" in Rule 57F(3) was not confined to goods that were the same or identical. It extended to goods broadly falling within the same class or category. Calcined alumina was an intermediate product in the manufacture of aluminium and both were treated as falling within the same broad class of products. The earlier decisions relied upon supported this wider construction of "similar" for utilisation of credit on the clearance of the final product.

Conclusion: The utilisation of Modvat credit was held to be permissible and the objection based on difference in tariff headings failed.

Final Conclusion: The demand was set aside and the appeal succeeded with consequential relief.

Ratio Decidendi: For Rule 57F(3), "similar" goods are not limited to identical goods but include goods broadly belonging to the same class or category, permitting credit utilisation accordingly.

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