2019 (7) TMI 1127

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....Q of CESTAT Rules does not allow any such MODVAT Credit in respect of duty paid by the Appellant on purchase of capital goods. 2. The relevant portion of the order passed by the Tribunal is quoted below for ready reference:- "4. After hearing both sides and on perusal of the records, we find that the appellant filed the MODVAT declaration vide letter dated 27.9.1999 under Rule 57T of the erstwhile Rules. Original authority observed that Rule 57R of the erstwhile Rules provides for the eligibility of credit of a manufacturer/supplier, who supplies exempted final products inter alia to a 100% EOU on capital goods. It does not refer to the eligibility of a 100% EOU. Commissioner (Appeals) has observed that EOUs are treated as special class ....

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.... Chapter V-A and submitted that based on such provision, the Respondent-Department is contending that the Assessee is not entitled to MODVAT Credit against the clearance of the final products made by the Assessee. The said provision is also quoted below for ready reference:- "Rule 100H. Exemption from certain provisions-- (1)The provisions contained in rules 43, 44, 45, 46, 47, 50, 52, 52A, 53, 53A, 54, 55, 56A, 56AA, 56B, 56C, 57A, 57Q, Chapter VII, Chapter VIII, rules 223A, 223B, 224, 228 and 229 shall not apply to a manufacturer who produces or manufactures excisable goods in a free trade zone. (2)The provisions contained in rules 43, 44, 45, 46, 47, 50, 52, 52A, 53, 53A, 54, 55, 56A, 56AA, 56B, 56C, 57A, 57Q, Chapter VII, rules 22....

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....final products except when the final product is either, i) cleared to a unit in a Free Trade Zone ii) cleared to a 100% EOU, or iii) cleared to a Unit in a EHTP on STP. From a careful reading of the said provisions you will appreciate that it refers to the eligibility of a manufacturer supplier who supplies exempted final products inter alia to 100% EOU, for modvat credit of duty paid on Capital Goods. It does not refer to the eligibility of a 100% EOU. It is also observed that based on your Application dated 17.6.99 for permission Under 100% EOU Scheme, Development Commissioner has permitted/extended all facilities and privileges admissible as envisaged in Export/import Policy 1997-2002, on 28.7.99 itself, even before obtaining C....