Modvat credit on dealer invoices upheld where the notification did not require express manufacturer authorisation.

Invoices issued by wholesale dealers or distributors of the manufacturer were treated as valid documents for Modvat credit where the governing notification did not require proof of specific authorisation by the manufacturer. Credit could not be denied merely because the dealers were not shown to have been expressly appointed, as no such statutory condition existed under Rule 57A and the relevant notification. On that basis, the invoices were accepted for availing Modvat credit and the denial of credit was unsustainable.

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Issues: Whether invoices issued by unregistered dealers could be treated as valid documents for taking Modvat credit under Rule 57A.

Analysis: The invoices were issued in 1994 by dealers who were not shown to have been specifically appointed by the manufacturer. The governing notification permitted acceptance of invoices issued by wholesale dealers or distributors of the manufacturer, and it did not require proof of any specific appointment by the manufacturer. In the absence of such a statutory requirement, credit could not be denied merely because the dealers were not expressly authorised.

Conclusion: The invoices were valid for availing Modvat credit and the denial of credit was unsustainable.

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