Per K.K. Bhatia:

In terms of provisions of Rule 57A of the Central Excise Rules, 1944, the Govt. of India, Ministry of Finance issued Notfn. No. 5/94-CE (N.T.) dt. 1.3.94, in which, they specified the inputs and the end products in respect of which the modvat credit of duty could be availed. This notification was further amended by Notfn. No. 14/98-CE (NT) dt. 2.6.98, by virtue of which the modvat credit on the specified duties was restricted to 95% for utilisation or for payment of duty on the final products. This amendment further provided that the credit of the specified duty paid in respect of inputs, viz., naphtha, furnace oil, low sulphur heavy stock, light diesel oil, bitumen and paraffin wax falling under Chapter 27 shall be restricted in the case of input products produced or manufactured in India to the extent of amount of excise duty calculated @ 10% ad valorem and in the case of imported inputs to the extent of the amount of additional duty calculated by assuming as if the like input produced or manufactured in India is chargeable to excise duty @ 10% ad valorem. However, under Notfn. No. 60/97-C.E. (NT) dt. 27.11.97, a manufacturer of the excisable goods who import