Modvat - Declaration under Rule 57G - Regarding - Central Excise - 267/114/88-CX.8

Modvat - Declaration under Rule 57G - Regarding F. No. 267/114/88-CX.8 Dated 17-10-1989 Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Modvat - Declaration under Rule 57G - Regarding I am directed to invite your attention to Board's circular No. 43/88, dated 15-9-1988 issued from F. No. 267/114/84-CX.8 on the above subject. It has been clarified in the aforesaid circular that where the classification of the inputs declared by the assessee does not tally with the correct classification then Modvat credit can be taken in RG 23A but should not be utilised for payment of duty till the correct classification of the input is arrived at by the Central Excise Officers of the originating factory. Collector of Central Excise, Bangalore has pointed out that there is no provision in Central Excise rules for denying the utilisation of credit taken in RG 23A. Therefore, the above instructions need reconsideration. The matter has been further examined by the Board. It has been decided that where the classification of the input declared by the assessee does not tally with the correct classification then the assessment should be immediately made provisional by the originating Collectorate. The correct classification of the product should be arrived at by inter-division inter-collectorate correspondence. The duty provisionally paid should be allowed to be taken as credit in RG 23A and utilised for payment of the duty on final product subject to the adjustment of credits on the basis of duty finally assessed by following the procedure prescribed under Rule 57E. Board's instructions dated 15-9-88 may be modified to the above extent. 2. The above instructions may be brought to the notice of the field formations. 3. Trade interests may also be suitably informed. 4. Receipt of this letter may please be acknowledged.