Modvat credit cannot be denied for a mere invoice description defect when substantive eligibility still requires verification.

Modvat credit could not be denied merely because dealer-issued documents were described as subsidiary invoices, where they were issued by a registered dealer under Rule 57GG and indicated they were meant for Modvat credit. The descriptive label alone was insufficient to reject credit, because entitlement still depended on verification of the invoices' duty-paid character, the dealer's registration, receipt of inputs in the factory, and use of those inputs in manufacture. The impugned order was therefore set aside and the matter remitted for fresh examination of eligibility on the factual prerequisites for credit.

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Issues: Whether Modvat credit could be denied merely because the dealer-issued documents were described as subsidiary invoices and whether the matter required fresh verification of eligibility.

Analysis: The documents were issued by a registered dealer under Rule 57GG of the Central Excise Rules and bore a note that they were meant for Modvat credit. The denial proceeded on an incorrect premise by treating the documents as subsidiary gate passes and by focusing only on the descriptive word "subsidiary". The procedural description on the invoices could not, by itself, justify denial of credit. At the same time, entitlement to credit still depended on verification of the duty-paid nature of the invoices, the dealer's registration, receipt of inputs in the factory, and use of those inputs in manufacture.

Conclusion: The denial of credit could not be sustained on the stated ground alone, and the matter had to be re-examined on the factual prerequisites for Modvat credit.

Final Conclusion: The impugned order was set aside and the matter was sent back for fresh decision on eligibility to credit.

Ratio Decidendi: A minor procedural defect in the description of invoices does not by itself warrant denial of Modvat credit when the substantive requirements for credit remain to be verified.

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