Modvat credit cannot be refused for belated availment where duty-paid inputs and supporting documents establish substantive entitlement.

Modvat credit could not be denied merely because it was taken belatedly or because RG 23A records were not maintained contemporaneously. Where duty-paid inputs were supported by duty-paying documents and their duty-paid character was undisputed, substantive entitlement prevailed over procedural irregularity. In the absence of a prescribed time limit, the relevant test was whether the credit claim was made within a reasonable time; the delay was attributed to the department's pending response. The later preparation of records did not defeat credit when the underlying eligibility was established, and procedural requirements could not override the object of the Modvat scheme.

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Issues: Whether Modvat credit could be denied merely because it was taken belatedly and the RG 23A register was not maintained contemporaneously.

Analysis: The credit was supported by duty-paying documents and the duty-paid nature of the inputs was not disputed. In the absence of a prescribed time limit, the relevant test was whether credit was taken within a reasonable time. The delay in taking credit was attributable to the department's pending response, and the subsequent maintenance of records did not justify denial of credit when the substantive entitlement was otherwise established. Procedural requirements could not be given precedence over the object of the Modvat scheme so as to defeat a substantive benefit.

Conclusion: The denial of Modvat credit was unsustainable; the credit was admissible despite the belated claim and the later preparation of RG 23A.

Ratio Decidendi: Where duty-paid inputs and supporting documents establish entitlement, Modvat credit cannot be denied solely for belated availment or procedural non-compliance if the claim is otherwise made within a reasonable time.

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