( 1 ) THE petitioner is engaged in the manufacture of acid slurry. It is not disputed that for the manufacture of acid slurry, sulphuric acid is used as input. During the process of manufacture of the acid slurry, contends the petitioner, a by-product is obtained known as spent sulphuric acid. On duty-paid input from May to October, 1991, the MODVAT Credit was taken in full by the petitioner while clearing the final product, that is, the acid slurry.

( 2 ) TAKING recourse to Rule 57-I of the Central Excise Rules, 1944 (briefly the Rules), impugned notice dated 28-11-1991 (Annexure 6 to the writ petition) was served on the petitioner calling upon it to show cause why MODVAT credit to the extent of Rs. 36,798/- should not be recovered from it. Brief reason for demanding the aforesaid amount given in the said notice, is that duty-paid input was not consumed in full in the manufacture of final product and that "the differential quantity is neither waste nor a product other than the said input except that it gets diluted and known as spent ACID. " The stand taken in the impugned notice is that the entire duty-paid input during the relevant period was not actually consumed in the final p