2006 (7) TMI 673 - HC - Central Excise

Summary

Issues:
Interpretation of Notification No. 5/94-C.E. (N.T.), dated 1-3-1994 regarding Modvat credit entitlement.

Analysis:
The judgment dealt with the interpretation of Notification No. 5/94-C.E. (N.T.), dated 1-3-1994, specifically focusing on the entitlement of Modvat credit on inputs received from a 100% EOU. The question raised was whether the assessee was entitled to avail Modvat credit despite the restrictions laid down in the notification. The Notification restricted the credit of duty to the extent equal to the additional duty leviable on the goods under Section 3 of the Customs Tariff Act, 1975. The issue arose due to conflicting views by different Benches of the Appellate Tribunal, leading to a Reference to the Larger Bench of the CEGAT, which ruled in favor of the assessee's right to avail of Modvat credit.

The respondent's counsel argued that under Section 35G of the Central Excise Act, an application concerning the rate of duty or the value of goods for assessment cannot be entertained by the High Court. The Court concurred that the question raised indeed pertained to the rate of duty to be applied, falling within the ambit of Section 35G. Consequently, the Court held that it lacked jurisdiction to entertain the appeal, resulting in its dismissal. The judgment emphasized that the applicant could pursue the matter by initiating appropriate proceedings before the Apex Court to address the raised question regarding Modvat credit entitlement under the notification.

In conclusion, the High Court of BOMBAY dismissed the appeal, citing lack of jurisdiction to address the question raised concerning the entitlement of Modvat credit under Notification No. 5/94-C.E. (N.T.), dated 1-3-1994. The judgment highlighted the need for the applicant to pursue the matter further by approaching the Apex Court for resolution.