Modvat credit refusal on original invoice copy is appealable, and unchallenged rejection bars unauthorised credit.

A refusal by the Assistant Commissioner to permit Modvat credit on the strength of the original invoice copy under Rule 57T(8) was treated as a quasi-judicial order with civil consequences because it directly affected the assessee's right to avail credit. The order was therefore appealable under Section 35 of the Central Excise Act, 1944. Where no appeal is filed against such refusal, the decision attains finality and binds the assessee. Credit taken without the required permission is unauthorised and liable to disallowance.

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Issues: Whether the decision of the Assistant Commissioner refusing permission to avail Modvat credit on the strength of the original invoice copy was an appealable order, and whether the assessee could validly retain credit taken without such permission.

Analysis: Under Rule 57T(8) of the Central Excise Rules, 1944, permission to take credit on the original invoice copy depended on the Assistant Commissioner being satisfied that the duplicate copy had been lost in transit. A decision under that sub-rule directly affected the assessee's right to avail Modvat credit and therefore had civil consequences. Such a decision was appealable under Section 35 of the Central Excise Act, 1944. Since no appeal was filed against the rejection communicated by the Assistant Commissioner, that decision attained finality and binding force. Credit taken without the required permission was consequently unauthorised and liable to be disallowed.

Conclusion: The refusal of permission was appealable and had attained finality, and the disallowance of the Modvat credit was upheld against the assessee.

Ratio Decidendi: A quasi-judicial order refusing permission for Modvat credit under Rule 57T(8), because it determines civil consequences, is an appealable order and becomes final if not challenged; credit taken without such permission is unauthorised.

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