Modvat credit cannot be denied for a clerical invoice error or a ground outside the show cause notice.

Modvat credit could not be denied for a clerical error in the master invoice number where the relevant invoice particulars were otherwise furnished and substantial compliance was shown. A ground not raised in the show cause notice could not be relied on to sustain disallowance, as it denied the assessee an opportunity to explain or cure the defect. The first appellate order was also unsustainable because it was non-speaking and contained no real reasoning. The denial of Modvat credit was therefore set aside in favour of the assessee.

---

---

Issues: Whether Modvat credit could be denied on account of a clerical mistake in the master invoice number and a ground not set out in the show cause notice, and whether the appellate order, being non-speaking, could be sustained.

Analysis: The Modvat credit was disallowed on the basis of a wrong master invoice number entered by the supplier, although the relevant invoice particulars had otherwise been furnished. The adjudicating authority relied upon a matter beyond the scope of the show cause notice, depriving the assessee of an opportunity to explain or cure the defect. The defect was only a clerical or procedural irregularity and did not justify denial of substantive Modvat benefit, particularly where substantial compliance was shown. The first appellate order also contained no real reasoning and was merely a non-speaking affirmance of the disallowance.

Conclusion: The denial of Modvat credit was unsustainable, and the orders of both lower authorities were set aside in favour of the assessee.

---