Modvat credit on pre-1994 gate passes raises a referable question of law where the governing notification is unclear.

A question of law arose on whether gate passes issued before 1-4-1994 and endorsed later could still be used to claim Modvat credit under Rule 57G of the Central Excise Rules, 1944. The Tribunal noted earlier support for admissibility of credit on such documents, but also the contrary view based on uncertainty in Notification No. 16/94. Because the legal position was unclear, the issue was treated as referable and the reference application was allowed.

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Issues: Whether a point of law arose on the validity of gate passes issued before 1-4-1994 and endorsed thereafter for availing Modvat credit under Rule 57G of the Central Excise Rules, 1944.

Analysis: The Tribunal noted its earlier view that Modvat credit was admissible on the strength of gate passes issued before 1-4-1994 and used up to 30-6-1994, but also noticed the contrary reconsideration based on the absence of a clear indication in Notification No. 16/94. In that situation, the question whether such gate passes remained valid documents for Modvat purposes required determination as a legal issue.

Conclusion: A question of law arose and the reference was warranted.

Final Conclusion: The reference application was allowed in support of the Revenue's request for a legal ruling on the admissibility of Modvat credit on the disputed gate passes.

Ratio Decidendi: Where the legal position on the admissibility of Modvat credit under the governing notification is not clear, the issue gives rise to a referable question of law.

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