Deemed Modvat credit turns on prescribed proof, with non-notified conditions excluded and curable defects remanded for fresh consideration.

Deemed Modvat credit under a conditional exemption notification could not be denied merely because delayed interest had not been paid, since the notification required only discharge of duty liability and the invoice declaration, supported by the range superintendent's certificate, showed compliance; the credit was therefore admissible. For the balance claim, where the invoice lacked the prescribed declaration, self-certification by the supplier was insufficient and proof from the jurisdictional Central Excise officer was required; however, the defect was treated as curable and the matter was remanded for fresh adjudication after allowing additional evidence.

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Issues: (i) Whether deemed Modvat credit could be denied on the ground that the input-manufacturer had not paid delayed interest, when the notification required only discharge of duty liability; (ii) Whether the remaining deemed credit was admissible on the strength of the invoice and self-certification, or required a certificate from the proper Central Excise officer, warranting remand for fresh adjudication.

Issue (i): Whether deemed Modvat credit could be denied on the ground that the input-manufacturer had not paid delayed interest, when the notification required only discharge of duty liability.

Analysis: The notification required the input-manufacturer under the compounded levy scheme to declare on the invoice that duty liability had been discharged. The relevant invoice carried such a declaration, and a certificate from the Central Excise Range Superintendent confirmed full and final discharge of duty liability for the relevant period. The absence of payment of delayed interest was not a condition imposed by the notification, and that factor could not be used to deny the credit.

Conclusion: The credit of Rs. 18,852.48 was admissible and is allowed in favour of the assessee.

Issue (ii): Whether the remaining deemed credit was admissible on the strength of the invoice and self-certification, or required a certificate from the proper Central Excise officer, warranting remand for fresh adjudication.

Analysis: The invoice did not contain the declaration envisaged by the notification, and the assessee therefore had to establish discharge of duty liability by proper evidence. A certificate from the jurisdictional Central Excise officer was the appropriate proof, while self-certification by the supplier was insufficient. At the same time, the defect was procedural and capable of being cured, so the assessee was to be given an opportunity to produce the necessary certificate before the original authority.

Conclusion: The admissibility of the remaining credit of Rs. 22,110/- was remanded for de novo adjudication in favour of the assessee on the limited question of fresh consideration.

Final Conclusion: The assessee succeeded on one part of the claim outright, while the balance claim was sent back for fresh decision after permitting additional evidence.

Ratio Decidendi: A credit claim under a conditional exemption or deemed-credit notification cannot be denied on grounds not prescribed by the notification, and a procedural evidentiary defect curable by producing proper proof should ordinarily be examined afresh rather than defeating the substantive entitlement outright.

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