Modvat credit on supplier invoices denied where dealer registration was never proved under transitional relief rules.

Rule 57H transitional relief for Modvat credit allowed acceptance of invoices and other prescribed documents up to 31-12-1994, but the cut-off date governed acceptance of documents and did not by itself require dealer registration to be completed by that date. The relief was available only where registration was ultimately obtained and the document otherwise met the prescribed conditions. On the facts, the dealers' registration was not proved at all, even after the cut-off date, so the case was treated as one of absence of registration rather than mere delay. Modvat credit was therefore denied.

---

---

Issues: Whether Modvat credit could be denied where the supplying dealers had not been shown to have obtained registration, and whether the circular's time limit for acceptance of documents required dealer registration by the cut-off date.

Analysis: Rule 57H of the Central Excise Rules governed transitional relief for acceptance of invoices and other prescribed documents for Modvat credit. The Board's circular permitted acceptance of such documents up to 31-12-1994 and, on the interpretation adopted from the cited precedent, the cut-off date related to the exercise of discretion for accepting documents and did not by itself require that registration must be completed by that date. That relief, however, was considered applicable only where registration was eventually obtained and the document otherwise satisfied the prescribed conditions. On the facts before it, there was no proof that the dealers whose invoices were relied upon were registered at all, even after 31-12-1994, so the case was treated as one of absence of registration rather than delayed registration.

Conclusion: The denial of Modvat credit was upheld and the issue was decided against the assessee.

Ratio Decidendi: Relief under the transitional Modvat scheme for acceptance of invoices could not be extended where the supplying dealer's registration itself was not established; the protection against procedural delay does not cover a complete absence of registration proof.

---