Modvat credit requires timely declaration; inordinate delay in filing the declaration justified denial of credit.

Filing a declaration under the Modvat scheme was treated as a substantive statutory condition, and credit taken before compliance could not be sustained where the declaration was filed only after an inordinate delay of about three years. The prolonged lapse was viewed as showing indifference to the prescribed procedure, and no legal basis was found to condone the delay. The Modvat credit was therefore denied.

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Issues: Whether the delay of about three years in filing the declaration for availing Modvat credit could be condoned and the credit taken prior to filing of the declaration could be sustained.

Analysis: The credit was availed before the declaration under the Modvat scheme was filed, and the request for condonation of delay was itself made after an inordinate lapse of time. The requirement of filing the declaration was treated as a substantive statutory condition under the scheme, and such prolonged delay was held to reflect indifference to the prescribed procedure. No legal infirmity was found in refusing to condone the delay.

Conclusion: The delay was not condonable and the Modvat credit was rightly denied.

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