Modvat credit cannot be denied for invoice defects when duty-paid inputs and manufacture use are otherwise proven.

Modvat credit could not be denied merely for procedural defects in invoices or lapses in the supplier's records where duty-paid nature of the inputs, their description, assessable value, receipt, and use in manufacture were established. The amended Rule 57G and the Board circular required credit to be allowed when substantive compliance was shown, and a supplier's failure to reflect the invoices in returns or RG 23D records could not by itself defeat the recipient's entitlement. Objections not raised in the original show cause notice were also outside its scope. On these facts, the assessee was entitled to credit.

---

---

Issues: Whether Modvat credit could be denied on the basis of procedural defects in the invoices and lapses in the supplier's records when the duty-paid nature of the inputs and their use in manufacture were not in dispute, in view of the amendment to Rule 57G of the Central Excise Rules and the Board circular.

Analysis: The show cause notices proceeded only on the allegation that the invoices were tampered with or were not in the prescribed form. The later objection based on the supplier's failure to reflect the invoices in monthly returns and RG 23D records was not part of the original notice. The amended sub-rule inserted in Rule 57G, read with the Board's circular, required credit not to be denied merely because the document lacked particulars, where duty payment, description of goods, assessable value, and the recipient's receipt and use of the inputs were otherwise established. The procedural lapse, if any, was attributable to the supplier and could not, by itself, defeat the recipient's credit when substantive requirements were satisfied.

Conclusion: Modvat credit could not be denied on the facts of the case, and the assessee was entitled to succeed.

---