Modvat credit requires prior declaration and dated acknowledgement; credit denied where statutory precondition was not proved.

Rule 57G requires a manufacturer to file the declaration and obtain the prescribed dated acknowledgement before taking Modvat credit, and the Tribunal treated this as a statutory precondition rather than a procedural formality. Because the declaration's filing was doubtful, no dated acknowledgement from the proper authority was proved, and the authorised signatory's statement indicated omission of the input by mistake or oversight, the requirement was not met. Modvat credit was therefore inadmissible, and the order permitting the credit was set aside in favour of Revenue.

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Issues: Whether filing of a declaration under Rule 57G and obtaining a dated acknowledgement before taking Modvat credit is a mandatory statutory requirement, and whether credit can be denied where the declaration and acknowledgement are not proved.

Analysis: Rule 57G(2) permits a manufacturer to take credit only after filing the declaration under sub-rule (1) and obtaining the required acknowledgement. The Tribunal treated this as a statutory precondition, not a mere procedural formality. On the facts, the filing of the declaration itself was doubtful because receipt was not acknowledged by the addressee, and no dated acknowledgement from the proper authority had been obtained before credit was taken. In addition, the authorised signatory's statement supported the view that the input was omitted from the declaration by mistake or oversight. The requirement under Rule 57G was therefore not satisfied.

Conclusion: The Modvat credit was inadmissible and the order allowing the credit was set aside in favour of Revenue.

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