Modvat credit on capital goods imported under Project Imports- Reg.

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..... ustoms Tariff; (ii) the notification issued under rule 57A of the Central Excise Rules as well as the Annexure given under rule 57Q, does not mention goods cleared under the heading No. 98.01 of the Customs Tariff Act; and (iii) in the absence of specific mention about the eligibility of the goods imported under the Project Import Regulations, such goods are not entitled to Modvat credit. 2. The matter has been examined by the Board. It is observed that capital goods credit scheme was introduced w.e.f. 1.3.1994. At that time, Modvat credit under the capital goods credit scheme was allowed on the following goods:- (a) machines, machinery, plant, equipment, apparatus, tools or appliances used for producing or processing of any goods or .....

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..... more specific heading elsewhere in the Schedule. 6. Prior to 1.3.97, credit was available on capital goods specified in the Explanation to rule 57Q. Since there is no Chapter under Central Excise Tariff parallel to Chapter 98 of the Customs Tariff, the appropriate classification of the goods imported under Project Import Regulations, shall require to be determined within chapters 1 to 96 of Central Excise Tariff, for the purpose of allowing Modvat credit. Thus the crucial test for allowing Modvat credit would be whether the capital goods were covered, either in terms of classification or description, by the expression "capital goods" as defined in Explanation to rule 57Q or not. 7. However, difficulties may be experienced in some cas .....

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..... s: 9. Particulars of Capital goods eligible for Modvat credit: Description of capital goods Tariff Classification Assessable Value Amount of Eligible credit Rs. As % age value of B / E (1) (2) (3) (4) (5) Total ______________________ Declaration Certificate that I/We have called for and have obtained all the information and explanations, which to the bast of our knowledge and belief were necessary for verification of the particulars given above. Certified further that, in our opinion: (i) the assessable value of the capital goods eligible for Modvat credit as mentioned in column (3) of the Table above, .....

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