Modvat credit on original invoice allowed when duplicate copy was lost in transit and substantive conditions were satisfied.

Modvat credit was admissible on the original invoice where the duplicate copy had been lost in transit, provided the inputs were received in the factory and duty had been paid. Rule 57G(6) of the Central Excise Rules, 1944 allowed such credit on satisfaction of these conditions, and the absence of prior permission from the competent authority did not by itself justify denial. The analysis followed the cited High Court view that procedural non-compliance in obtaining advance permission could not defeat substantive credit when the factual requirements were met. Credit was therefore allowed on the original invoice.

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Issues: Whether Modvat credit could be denied when the duplicate copy of the invoice was lost in transit and credit was taken on the original invoice without prior permission of the competent authority.

Analysis: Rule 57G(6) of the Central Excise Rules, 1944 permitted a manufacturer to take credit on the basis of the original invoice where the duplicate copy had been lost in transit, subject to satisfaction that the inputs had been received in the factory and duty had been paid. The facts showed that the inputs were received and the appellant had taken credit on the original invoice after the duplicate copy was taken away by the Sales Tax Authorities. The cited High Court decision held that credit could not be denied merely because the required permission of the competent authority had not been obtained in advance.

Conclusion: Modvat credit could not be denied on the ground that prior permission was not taken, and the credit was admissible on the original invoice.

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