Modvat credit for traders upheld where invoices and transport documents supported the claim, and delay objections failed.

Modvat credit was available on invoice-based goods where the claimant produced invoices, challans and transport documents, and the denial on a supposed factual distinction was not accepted. Delay in seeking permission was not treated as a valid ground to refuse credit. Rule 57G was construed in the Modvat framework to cover traders as well as manufacturers even before the 1998 amendment, with Notification No. 15/98-C.E. (N.T.) treated as clarificatory of that existing position. The credit claim was therefore upheld and the objections based on delay and trader status were rejected.

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Issues: Whether the appellant, a registered trader, was entitled to Modvat credit on the invoice-based goods and whether the credit claim could be denied on the ground of delay or on the view that traders were outside the scope of the relevant rule before the 1998 amendment.

Analysis: The credit claim was supported by invoices, challans and transport documents, and the earlier remand had required the authority to follow the Tribunal's view in an analogous case. The denial based on factual distinction was not accepted. The delay in seeking permission was also held not to justify refusal. On the trader issue, the scheme of Rule 57G was read in the context of the Modvat framework and the later amendment by Notification No. 15/98-C.E. (N.T.), which expressly introduced sub-rule (6) for traders. The amendment was treated as clarificatory of the pre-existing understanding that the rule was not confined only to manufacturers.

Conclusion: The appellant was entitled to the credit and the objections based on delay and trader status were rejected.

Ratio Decidendi: Under the Modvat scheme, Rule 57G was construed to extend to traders as well as manufacturers even before the 1998 amendment, and credit could not be denied when the documentary basis and grounds for delay were accepted.

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