Notification No. 46 dated 11^th October 1989 {As amended by MF (DR) letter F.No. 354/73/89-TRU dated 21^st November 89, 26/91 (NT)}

In exercise of the powers conferred by rule 57K of the Central Excise Rules, 1944, the Central Government hereby specifies-

(i)     the inputs; namely, vegetable oil (whether or not subjected to any one or more of the processes of hydrogenation or hydrolysis) of the description in column (2) of the Table hereto annexed and used in the manufacture of the final product, namely, soap, falling under sub-heading No. 3401.10 of the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); and

(ii)    the rates in the corresponding entry in column (3) of the said Table as the rate at which credit may be granted for use of such inputs in the manufacture of the said final products,

for the purposes of Section AAA of Chapter V of the said rules, and stipulates that the grant of credit and utilisation thereof, shall, in addition to the provisions of the said Section, be subject to the following condition, namely:-

(i)     the credit shall be taken only in respect of indigenous inputs;

(ii)    in the cases where all the processes relating to the manufacture of soap, starting from vegetable oils, are done in the same factory, the credit shall be taken on the quantity of vegetable oils received into the factory for the purpose and only on or after the date of receipt of such vegetable oils;

(iii)   in the case where the process of hydrogenation or hydrolysis are done outside the factory manufacturing soap, the credit shall be allowed:-

(a)    only if the procedure that may be specified by the Commissioner to establish the identity of the vegetable oils from which such processed oil has been made, is followed and only if the manufacturer produces such documents as may be required by the Commissioner in this regard;

(b)    only on or after the receipt of such hydrolysed or hydrogenated vegetable oils into the factory manufacturing soap;

(c)    on the quantity of processed vegetable oils received into the factory calculated at the rate applicable to the corresponding vegetable oils.

(iv)    the credit taken during any calendar month shall be utilised for payment of duty on the said final products only after the commencement of the succeeding month; and

(v)    the credit available in RG 23 B may be utilised for the payment of duty on any soap manufactured by the manufacturer and no amount of excess credit if any available in the credit account shall be refunded to the manufacturer or utilised for the payment of duty on any other  excisable goods.