Modvat credit cannot be denied for minor procedural lapses where the supporting invoice can still be verified.

Modvat credit cannot be denied solely because the assessee initially relied on the 6th copy of the invoice and later produced the original for verification, where the credit is otherwise linked to duty-paid inputs. Strict insistence on proving loss of the duplicate copy was treated as too rigid, because the procedural requirements are beneficial and meant to prevent misuse, not defeat substantive entitlement on minor lapses. As the original invoice had not been verified before rejection, the denial was unsustainable. The matter was remanded for verification of the original invoice and grant of credit if the document was found to be in order.

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Issues: Whether Modvat credit could be denied merely because it was initially taken on the 6th copy of the invoice and the original invoice was later produced for verification, without strict compliance with the procedure for showing loss of the duplicate copy.

Analysis: The denial rested on a strict procedural objection that the original invoice had been produced instead of the prescribed duplicate copy and that the procedure in the trade notice for proving loss of the duplicate had not been followed. The available credit was otherwise linked to duty-paid inputs, and the procedural rules governing Modvat credit were held to be beneficial and intended to prevent misuse, not to defeat credit on minor procedural lapses. The original invoice had not been verified by the adjudicating authority before rejection, and the earlier reasoning was found too rigid. The principle that procedural provisions should not override the substantive entitlement where the document can be authenticated was applied.

Conclusion: The denial of Modvat credit on the sole ground of procedural non-compliance was not sustainable; the matter was remanded for verification of the original invoice and grant of credit if found in order.

Ratio Decidendi: Modvat credit, being a beneficial entitlement, cannot be denied solely for minor procedural irregularities if the authenticity of the supporting document can be verified and the substantive conditions are otherwise satisfied.

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