Modvat credit cannot be denied for invoices in another sister unit's name when goods were received and consumed.

Modvat credit could not be denied where duty-paying invoices were issued in the name of another manufacturing unit of the same assessee, provided the goods were actually received and consumed in the factory. The Tribunal held that post-1-4-1994 amendments and decisions concerning dealers' invoices under Rule 57GG did not govern transfers between sister units of the same manufacturer. It followed the earlier Larsen & Toubro view and treated the objection as only legal in nature, not based on any dispute about receipt or use of goods. Credit was therefore upheld on the facts stated.

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Issues: Whether Modvat credit could be denied to one manufacturing unit when the duty-paying invoices were issued in the name of another unit of the same assessee.

Analysis: The dispute turned on the effect of invoices issued in the name of a sister unit and whether, after the amendment from 1-4-1994, such documents could still support credit. The Tribunal distinguished cases dealing with dealers' invoices and the procedure under Rule 57GG, holding that those decisions did not govern transfers between two units of the same manufacturer. The earlier view in Larsen & Toubro was applied, and it was noted that the goods were actually received and consumed in the factory, with the objection being only legal in nature.

Conclusion: Modvat credit could not be denied on the sole ground that the invoices stood in the name of another unit of the same assessee. The issue was decided in favour of the assessee.

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