Modvat - Clarification regarding option and withdrawal

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..... dersigned is directed to invite attention to the references that have been received from the Collectors of Central Excise regarding permitting the small scale units to opt for or opt it of the Modvat Scheme. In particular the issues raised are, (i) Whether a small scale unit which had initially opted for payment of excise duty and availing of Modvat can be allowed to opt out of the same and avai .....

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..... e act that there is no one-to-one correlation between the inputs and the final products under the Modvat scheme it would not be possible to permit a manufacturer to opt out of Modvat scheme once he has exercised the option of paying duty (and to avail of Modvat) at the beginning of the financial year in respect of any specified goods. The manufacturer will have the option to go out of Modvat and a .....

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