Modvat credit on capital goods cannot be denied solely for missing Rule 57T declaration when substantive conditions are met.

Modvat credit on capital goods cannot be denied merely because the statutory declaration under Rule 57T was not filed, where the substantive conditions for credit are otherwise satisfied. A failure to file the declaration is treated as a procedural lapse and not a defect going to the root of entitlement. As the denial rested only on non-filing of the declaration, it could not be sustained and credit was held admissible in favour of the assessee.

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Issues: Whether Modvat credit on capital goods could be denied solely for non-filing of the declaration under Rule 57T of the Central Excise Rules, 1944.

Analysis: The dispute turned on whether the omission to file the statutory declaration was a mere procedural lapse or a defect going to the root of entitlement to credit. The Tribunal followed the settled view that Modvat credit should not be denied where the substantive conditions for credit are satisfied, and that minor procedural lapses in filing declarations should be ignored in pending matters. Since the denial in the impugned order rested only on non-filing of the Rule 57T declaration, the order could not be sustained.

Conclusion: The denial of credit was unjustified, and the issue was decided in favour of the assessee.

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