Modvat credit on duty-paid inputs cannot be denied solely because the customs declaration was altered after a change in buyer.

Modvat credit could not be denied merely because the customs declaration on the imported goods was overwritten or retyped to reflect the appellant as buyer. The inputs were duty paid at import, purchased from the importer, received in the appellant's factory and consumed there, and the record showed that the importer had not availed, and would not avail, Modvat credit or refund. The earlier intended buyer also had not taken credit on the same Bills of Entry. On these facts, the alteration was treated as a commercial change in the consignee's identity and not as evidence of double availment of credit. The appellant was therefore entitled to credit.

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Issues: Whether Modvat credit could be denied merely because the customs declaration accompanying the imported goods had been overwritten or retyped with the buyer's name and address.

Analysis: The goods were duty paid at import stage, purchased by the appellant from the importer, and received and consumed in the appellant's factory. The record showed that the importer had initially intended to sell the consignments to another buyer, but that transaction did not materialise, after which the consignments were sold to the appellant. The declaration on the reverse of the Bill of Entry indicated that the importer had not availed and would not avail Modvat credit or refund, and the evidence also showed that the earlier intended buyer had not taken credit on the same Bills of Entry. In these circumstances, the overwriting in the declaration was treated as a result of the commercial change in the recipient of the goods and not as a ground affecting the duty-paid nature of the inputs or indicating double availment of credit.

Conclusion: Modvat credit could not be denied to the appellant on the ground of overwriting in the declaration, as the same duty element was not availed more than once and the appellant was entitled to credit.

Ratio Decidendi: Modvat credit cannot be refused solely because the customs declaration was altered, if the inputs are duty paid, actually received and consumed by the claimant, and the record establishes that credit has not been availed more than once.

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