M/S. ESCORTS LTD. vs COMMNR. OF CENTRAL EXCISE, DELHI

The Supreme Court held that under Rules 57A, 57C, and 57D of the Central Excise Rules, 1944, MODVAT credit is not admissible if the final products are cleared without payment of duty. The Court affirmed the CEGAT's decision that the parts manufactured and cleared to another factory without duty payment do not qualify for MODVAT credit, as the final products are deemed to be the parts themselves. The appeal was dismissed, upholding the lower tribunal's ruling.