Modvat credit cannot be denied solely for delayed registration where no rule barred credit before certificate issuance.

Modvat/Cenvat credit cannot be denied merely because it was taken before issuance of central excise registration where the assessee had already applied for registration and the rules then in force contained no express prohibition. The Tribunal treated registration as a procedural requirement rather than a substantive condition for credit in those facts, and noted that the appellate authority had gone beyond the show cause notice and relied on inapplicable provisions. The operative effect was that delayed grant of registration did not, by itself, defeat the credit claim.

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Issues: Whether Cenvat or Modvat credit could be denied merely because it was availed before issuance of central excise registration, when the assessee had already applied for registration and the relevant rules contained no prohibition.

Analysis: The assessee had applied for registration before the credit was availed, and the registration certificate was issued shortly thereafter. The Tribunal held that, on the facts, the assessee could not be treated as unregistered for the purpose of denying credit merely because the certificate was issued later. It further held that the relevant Central Excise Rules, 1944 did not contain any bar or restriction against availing Modvat credit on that ground, and that registration was only a procedural requirement. The Tribunal also found that the appellate authority had travelled beyond the scope of the show cause notice and had relied on an inapplicable set of provisions.

Conclusion: Credit could not be denied solely on the ground of delayed issuance of registration, and the assessee's appeal succeeded.

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