Substantial compliance in Modvat invoicing barred denial of credit despite missing words on the transporter copy.

Modvat credit could not be denied for a technical defect in the invoice description where the format itself identified the copy meant for the transporter and that copy was duly ticked. The credit was rejected only because the invoices did not contain the exact words "duplicate for transporter", but the relevant copy was otherwise clearly marked and the inputs were not shown to have been diverted or left unused in manufacture. Substantial compliance with the invoicing requirement was therefore sufficient, and a minor deviation from the prescribed proforma did not justify denial of credit.

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Issues: Whether Modvat credit could be denied merely because the invoices did not contain the words "duplicate for transporter" when the invoice format clearly identified the copy meant for the transporter and a tick mark was placed against that copy.

Analysis: The disputed credit was rejected only on the ground that the invoices did not bear the exact words "duplicate for transporter". The invoice format on record, however, expressly identified the various copies by colour and purpose, including the duplicate copy for transporter, and the relevant copy was marked by a tick. The inputs were also not shown to have been diverted or not used in the manufacture of the final product. In such circumstances, the requirement of the rules was held to have been substantially complied with, and a minor departure from the prescribed invoice proforma could not justify denial of credit.

Conclusion: Modvat credit could not be denied on this technical objection, and the assessee was entitled to the disputed credit.

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