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TMI Blog2007 (3) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... id on the inputs subsequent to the date of the receipt of those inputs. Consequently, the respondent-manufacturer in the present case was entitled to take credit between the period 16-8-1987 to 30-12-1987 in the sum of Rs. 6,43,994.57. Appeal dismissed. - S.H. Kapadia and B. Sudershan Reddy, JJ. [Judgment per : S.H. Kapadia, J.]. - In this civil appeal filed by the department the short question which arises for determination is whether the assessee was entitled to avail Modvat credit on differential duty paid during the period 21-4-1986 to 2-4-1987 in respect of inputs received in his factory during the year 1986-87 which inputs were utilized between the period 16-8-1987 and 30-12-1987. According to the Department, Rule 57E of Central Exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account maintained under sub-rule (3) or in the current account under the Rule 9(3) or under Rule 173G(1). If such an adjustment was not possible for any reason then that adjustment had to be satisfied by payment in cash. Unfortunately, the corresponding provision came to be omitted or failed to be incorporated under Rule 57A of the Modvat Scheme. At this stage it may be noted that Rules 57A deals with applicability of the Modvat Scheme and which rule is part of the Rules set out in Chapter AA of Central Excise Rules titled "Credit of Duty Paid on Excisable Goods used as inputs" Rule 57E as it stood when Modvat was first introduced on 1-3-1986 provided for adjustment in duty credit. It originally provided that if the duty paid on any input ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecognizes the right of the manufacturer to claim credit. Rule 57E recognizes not only the right of the manufacturer to claim credit but also the extent to which credit could be claimed for the duty paid on inputs. Therefore, Rule 57A is a substantive provision. However, the procedure of adjustment finds place in Rule 57E. Rule 57E is procedural provision. It deals with adjustments in duty credit. The object behind enacting Rules 57A, 57E and 57G is to avoid duty on duty whereby the price of the final product is loaded. Therefore, Rule 57A recognizes the right of the manufacturer to take credit for the specified duty paid on the inputs, whereas Rule 57E deals with adjustment in the duty credit, such adjustment mean on account of reduction on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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