Deemed Modvat credit on declared duty-paid invoices requires full factual scrutiny before denial and may warrant remand.

Deemed Modvat credit was stated to be admissible where invoices contained the supplier's declaration that duty had been discharged under Rule 96ZP, and such credit could not be denied without examining the relevant factual and legal position. The lower appellate authority was found to have failed to consider the supplier's duty liability, the effect of the pending dispute, and the assessee's request to lead evidence. The record therefore required fresh consideration, and the matter was remitted for a new decision after hearing the appellants.

---

---

Issues: Whether deemed Modvat credit was admissible on invoices containing the supplier's declaration that duty had been discharged under Rule 96ZP, and whether the matter required remand for fresh decision.

Analysis: Notification No. 58/97-C.E. dated 30-8-97 permitted Modvat credit on the basis of invoices containing a declaration that duty had been discharged by the input supplier. The invoices carrying such declaration could not be denied credit without examining the relevant factual and legal position. The lower appellate authority had not considered this aspect in detail and had also failed to examine the assessee's plea concerning the supplier's duty liability and the effect of the pending dispute. In such circumstances, the record required fresh consideration and the assessee had to be afforded an opportunity to lead evidence in support of the claim.

Conclusion: The denial of deemed Modvat credit was not sustained in the manner adopted by the lower authority, and the matter was remitted for fresh decision after hearing the appellants.

---