Modvat credit on light diesel oil cannot be denied for non-filing when prior allowance remains unchallenged.

Modvat credit on light diesel oil could not be denied solely for non-filing of the Rule 57G declaration where an earlier order had already dropped proceedings on the same input and treated the credit as admissible. In the absence of any departmental appeal against that prior order, the later rejection of credit was held unsustainable. The denial was set aside and the assessee's Modvat credit claim was allowed.

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Issues: Whether Modvat credit on light diesel oil was rightly denied on the ground that the declaration under Rule 57G had not been filed.

Analysis: The prior order dropping proceedings in respect of light diesel oil was treated as establishing that credit had been allowed for that input and that the input was eligible for Modvat credit. On that basis, the later denial of credit for alleged non-filing of declaration was held to be unsustainable, especially since no departmental appeal against the earlier order was shown.

Conclusion: The denial of Modvat credit was set aside and the credit claimed by the assessee was allowed.

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