Procedural lapse in Rule 57T declarations cannot alone justify denial of Modvat credit on capital goods.

Modvat credit on capital goods could not be denied merely for non-filing of the declaration and intimation required under Rule 57T, because the filing requirement was treated as procedural and not a substantive bar. The disallowance also failed where the show cause notice did not specify the particular capital goods involved, leaving the allegation vague and unsupported by particulars. In these circumstances, the absence of the declaration alone was insufficient to sustain denial of credit, and the proposed disallowance was held unsustainable.

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Issues: Whether Modvat credit on capital goods could be denied solely for non-filing of declaration and intimation under Rule 57T when the show cause notice did not specify the particular capital goods involved.

Analysis: The denial of credit was founded only on the alleged absence of declaration under Rule 57T(1) and intimation under Rule 57T(2) of the Central Excise Rules, 1944. The show cause notice did not describe the relevant capital goods, though declarations in respect of capital goods and spares had been filed. In the absence of such particulars, the allegation remained vague and appeared to rest on presumption. The filing requirement was also treated as procedural, and the Board's circulars and cited decisions supported the view that Modvat credit could not be denied for such a lapse alone.

Conclusion: Modvat credit could not be denied merely for non-filing of the declaration and intimation, and the disallowance was unsustainable.

Ratio Decidendi: A procedural lapse in filing declaration under Rule 57T cannot by itself justify denial of Modvat credit, particularly where the show cause notice is vague and does not specify the capital goods to which the alleged lapse relates.

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