Modvat credit cannot be denied for delayed departmental acknowledgment where the Rule 57G declaration was filed on time.

Modvat credit could not be denied merely because the department acknowledged the Rule 57G declaration after delay, where the declaration had already been filed by the assessee. The operative fact was timely filing; the subsequent administrative delay in acknowledgment did not create a valid basis to refuse credit. On that reasoning, denial of Modvat credit solely for delayed departmental acknowledgment was unjustified.

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Issues: Whether Modvat credit in respect of inputs could be denied merely because the declaration under Rule 57G was acknowledged by the department after a delay, even though the declaration had been filed earlier.

Analysis: The declaration was found to have been filed on the stated date, and the delay occurred only in its acknowledgment by the departmental office. The denial of credit rested on that administrative delay. Such delay in departmental acknowledgment could not be treated as a valid ground to deprive the assessee of Modvat credit when the filing itself had been made.

Conclusion: The denial of Modvat credit on the ground of delayed acknowledgment was unjustified and was set aside, in favour of the assessee.

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