Modvat credit limitation on capital goods: actual factory receipt date governs, and minor filing delay did not defeat credit.

Modvat credit on capital goods was held admissible where the declaration was filed within three months from the actual date of receipt in the factory, not merely the date of entry in the statutory records. The assessee showed that the goods were delivered later because the truck broke down near the factory, and that evidence was accepted for limitation purposes. A minor procedural delay in filing the declaration was treated as non-fatal, consistent with the Larger Bench view that technical lapses should not defeat substantive credit. Credit was therefore not denied, and the delay was treated as condonable on the facts.

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Issues: Whether denial of Modvat credit on capital goods was justified on the ground that the declaration was filed beyond the prescribed period, and whether the actual date of receipt of the goods in the factory could be taken as the relevant date for computing limitation.

Analysis: The capital goods were entered in the statutory records on 10-12-1998, but the assessee produced evidence that the truck carrying the goods broke down near the factory and the goods were actually delivered in the factory on 12-12-1998. On that basis, the declaration filed on 12-3-1999 was treated as being within the three-month period. It was further held that any minor procedural lapse in filing the declaration should not defeat the credit otherwise available, particularly in light of the Larger Bench view that such technical delay ought not to stand in the way of substantive relief.

Conclusion: The denial of credit was not justified. The delay was held to be condonable on the facts, and the assessee was held entitled to Modvat credit.

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