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TMI Blog1990 (5) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the present appeal is whether in a situation where the supplier of raw material is called upon by the Department to pay more duty and whether the additional duty paid by the supplier on the inputs which in turn were purchased by the appellant, the appellant would be entitled to take credit or vary the credit to his advantage. In other words, if the inputs had suffered a certain sum originally at the hands of the supplier and if the supplier is called upon to make a payment of differential duty later, whether the receiver of the inputs would be entitled to take credit in respect of the differential duty paid by the supplier on the inputs. 2. Shri Balasubramaniam, learned Councel for the appellants submitted that Rule 57E of the Centra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rule (3) of Rule 57G or in the accounts maintained under Rule 9 or sub-rule (1) of Rule 173G or, if such adjustment is not possible for any reason, by cash recovery from the manufacturer availing of credit under Rule 57A". On consideration of the above rule, we are of the view that there should be a variation in the rate of duty payable in respect of the input either by operation of law or by otherwise and in the present case it cannot be disputed that there was no variation in regard to the duty payable for the inputs in question and the same continued to be at 20% right through. Merely because the supplier committed a mistake in not clearing the input by paying 20% duty and paid only 12% duty and subsequently paid the differential duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayments. The specific provisions of Rule 57E, after its amendment from 1-3-1987 does not go against the substantive provisions of Rule 57A which is the basic authority for the Modvat Scheme. The amended provisions of Rule 57E are not by way of expanding the scope of Rule 57A. They are in the nature of a clarification only and the benefit in question would be available right from 1-3-1986 when the Modvat Scheme was introduced. We, therefore, hold that in the facts and circumstances of the case, the appellants would be entitled to take Modvat credit for the amount in question, since indisputably the input has suffered additional duty for the like sum. We would like to make it clear that under the Modvat Scheme there is no specific provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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