MODVAT credit eligibility survives post-cutoff endorsement where the scheme required only pre-cutoff issuance of gate passes.

Under the MODVAT scheme, gate passes issued before 1-4-1994 remained valid for credit even if endorsed after that date, because the notification required only pre-cutoff issuance and timely taking of credit. The later endorsement did not defeat eligibility in the absence of any express condition that endorsement also had to occur before the cutoff date. The credit claim was therefore upheld in favour of the assessee and against the Revenue.

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Issues: Whether gate passes issued before 1-4-1994 but endorsed on or after that date were eligible documents for taking credit under the MODVAT scheme.

Analysis: The relevant notification required only that the documents be issued before 1-4-1994 and that credit be taken within the stipulated period. It contained no requirement that endorsement must also be made before 1-4-1994. Since the gate passes were admittedly issued before the cutoff date, the subsequent endorsement did not affect eligibility for credit.

Conclusion: The question was answered in favour of the assessee and against the Revenue.

Ratio Decidendi: Where a concessionary credit scheme makes document issuance before a specified cutoff date the only relevant condition, subsequent endorsement after that date does not defeat eligibility unless the scheme expressly so provides.

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