Modvat credit cannot be denied on technical defects in bill of entry form where same-company factories fully account for duty-paid credit.

Modvat credit was held admissible where the bill of entry bore the company's registered office address instead of the factory address, because the importer and the factory belonged to the same company and the earlier Larsen & Toubro principle applied. Credit was also permitted to be taken by two factories of the same company on the same bill of entry, since endorsements were made on the document, the total credit matched the duty payable, and a strict technical objection to the form of endorsement could not defeat credit. The commentary states that a formal defect in the bill of entry or apportionment between sister factories will not bar credit where the duty-paid amount is fully accounted for.

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Issues: (i) Whether Modvat credit was inadmissible because the bill of entry bore the address of the registered office instead of the factory where credit was taken; (ii) whether credit could be taken by two factories of the same company on the same bill of entry.

Issue (i): Whether Modvat credit was inadmissible because the bill of entry bore the address of the registered office instead of the factory where credit was taken.

Analysis: The document was held to be a valid basis for credit. The factual position was that the importer was the same company owning the factory, and there was no objection to taking credit in the factory against a bill of entry bearing the company's address. The earlier decision in Larsen & Toubro Limited was applied to the facts, and the objection based only on the address shown on the bill of entry was rejected.

Conclusion: Credit was not barred on this ground and was rightly taken.

Issue (ii): Whether credit could be taken by two factories of the same company on the same bill of entry.

Analysis: The record showed endorsements on the reverse of the bill of entry made by the officers of the respective factories, and the aggregate of the credit taken matched the duty shown as payable. The only remaining objection was a technical one that the bill of entry was not, strictly speaking, a document endorsed for credit. The earlier ratio was extended to hold that where the same company owned both factories and the entire credit could have been taken by either factory, apportionment between the two could not be denied merely on that technicality.

Conclusion: Credit could validly be taken by both factories on the same document.

Final Conclusion: The denial of Modvat credit was unsustainable, and the assessee succeeded on both issues.

Ratio Decidendi: Where the importer and the factories belong to the same company and the duty-paid amount is fully accounted for, a technical objection to the form of the bill of entry or to apportionment of credit between factories cannot defeat Modvat credit.

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