Modvat credit requires prescribed duty-paying documents; endorsed invoices were not valid after the amendment in this job-work context.

After the amendment substituting invoices for gate passes, Modvat credit required receipt of inputs under the prescribed duty-paying documents, and an endorsed invoice was not one of them. The earlier view allowing endorsed invoices did not survive the Larger Bench ruling, and no separate exception applied because the recipient was described as a loan licensee. The job-work or loan-licence arrangement did not change the identity of the actual manufacturer or relax the documentary requirements, so credit was not available on the endorsed invoice in the stated facts.

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Issues: Whether an endorsed invoice could be treated as a valid document for taking Modvat credit after the amendment substituting invoices for gate passes, particularly where the goods were manufactured under a loan licence or job-work arrangement.

Analysis: The Tribunal held that the amended scheme specifically required receipt of inputs in the factory under the cover of the prescribed documents and that an endorsed invoice was not among them. The earlier view permitting endorsed invoices could not survive the Larger Bench ruling, and there was no legal exception merely because the recipient described itself as a loan licensee. The notification relied upon did not alter the position, as the actual manufacturer was the person carrying out the manufacturing process, while the procedure for job work only facilitated credit through proper invoicing.

Conclusion: An endorsed invoice was not a valid document for taking Modvat credit in the facts of the case, and the assessee was not entitled to the credit.

Ratio Decidendi: After the amendment, Modvat credit cannot be taken on an endorsed invoice unless the governing rules specifically recognise that document as one of the prescribed duty-paying documents.

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