Deemed Modvat credit cannot be denied for a missing invoice declaration when the substantive notification conditions are satisfied.

Deemed Modvat credit under Notification No. 58/97-CE could not be denied merely because the input-manufacturer's invoice did not contain the specific declaration, where the substantive conditions of the notification were otherwise satisfied. The notification's central declaration treated the specified inputs as deemed duty-paid and allowed credit of that deemed duty to the final-product manufacturer. The invoice declaration requirement was only subordinate and could not defeat the substantive grant. On the facts, the invoices carried endorsements showing discharge of duty liability, so the essential requirement was met and the credit was held admissible.

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Issues: Whether deemed Modvat credit under Notification No. 58/97-CE could be denied for want of a declaration by the input-manufacturer in the invoice, when the substantive conditions of the notification were otherwise satisfied.

Analysis: The notification contained a declaration by the Central Government that excise duty shall be deemed to have been paid on the specified inputs and that credit of the deemed duty shall be allowed to the manufacturer of the final product. The condition in the notification requiring an invoice declaration by the input-manufacturer was held to be subordinate to, and not capable of defeating, the substantive declaration contained in the notification. On the facts, the invoices showed declarations relating to discharge of duty liability under Rule 96ZP(3) or similar endorsements, and the substantive requirement of the notification was found to have been complied with.

Conclusion: The denial of deemed Modvat credit was not justified and the assessee was entitled to the credit.

Ratio Decidendi: Where a notification itself declares inputs to be deemed duty-paid, credit cannot be denied merely for absence of a further invoice declaration that would make the subordinate condition inconsistent with the substantive grant.

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