Modvat credit cannot be denied for delayed declaration when substantive conditions for capital goods are satisfied.

Delayed filing of the declaration for capital goods did not warrant denial of Modvat credit where the goods were received, installed, duty paid and otherwise satisfied the substantive conditions; the declaration requirement was treated as procedural and not as a bar to entitlement. The later beneficial amendment was regarded as remedial and intended to remove hardship, and the Board's circular supported applying that approach to pending matters. On that basis, the credit claimed was held admissible.

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Issues: Whether Modvat credit could be denied for delayed filing of the declaration in respect of capital goods when the substantive conditions for receipt, installation, duty payment, and use of the goods were satisfied, and whether the later beneficial amendment and the Board's circular could be applied to pending matters.

Analysis: The appeal turned on the effect of Rule 57T of the Central Excise Rules, 1944 and the later sub-rule which was treated as remedial and intended to remove hardship. The reasoning accepted that the declaration requirement was procedural in nature and that such procedural lapse should not defeat a substantive entitlement to Modvat credit where the capital goods had been received and installed in the factory and the relevant substantive conditions stood fulfilled. Reliance was also placed on the contemporaneous circular directing that pending cases be governed in a manner consistent with the beneficial provision.

Conclusion: The delayed declaration did not justify denial of Modvat credit, and the assessee was entitled to the credit claimed.

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