Modvat credit cannot be refused for procedural invoice defects when duty payment and use in manufacture are established.

Modvat credit cannot be denied for invoice defects where receipt of inputs, their duty-paid character, and use in manufacture are established. The amendment to Rule 57G of the Central Excise Rules, 1944, together with Circular No. 441/7/99-CX, clarified that omission of prescribed particulars in the invoice is not fatal if the Assistant Commissioner is satisfied about duty payment and use of the inputs. On the stated facts, the defects were procedural only and did not affect substantive entitlement to credit, so the denial was unsustainable and the assessee was granted credit.

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Issues: Whether Modvat credit could be denied merely because the invoices did not contain all prescribed particulars, where receipt of the inputs, duty-paid nature of the goods, and their use in manufacture were not disputed.

Analysis: The inputs were admittedly received by the assessee and their duty-paid character was not controverted. The credit had been denied only for invoice-related irregularities. The subsequent amendment to Rule 57G of the Central Excise Rules, 1944 by Notification No. 7/99-C.E. (N.T.) and the Board's Circular No. 441/7/99-CX. clarified that credit is not to be denied for omission of all particulars in the invoice where the Assistant Commissioner is satisfied about duty payment and use of inputs in manufacture. On the facts, the defects were only procedural and did not affect the substantive entitlement to credit.

Conclusion: Modvat credit could not be denied on account of the procedural lapses in the invoices, and the denial of credit was unsustainable.

Final Conclusion: The impugned order was set aside and the appeal was allowed, granting the assessee the benefit of credit.

Ratio Decidendi: Modvat credit cannot be denied for mere procedural defects in invoices when receipt of inputs, payment of duty, and use in manufacture are established.

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