Modvat credit cannot be denied for computer-generated invoices without pre-printed serial numbers where a binding circular permits them.

Modvat credit could not be denied merely because computer-generated invoices lacked pre-printed serial numbers. The Board's circular clarified that running serial numbers on such invoices do not constitute a breach of the rules, so denial of credit on that ground alone was unwarranted. The Tribunal also applied the principle that revenue authorities cannot adopt a position contrary to a binding circular. The issue was therefore decided in favour of the assessee.

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Issues: Whether Modvat credit could be denied merely because the computer-generated invoices did not bear pre-printed serial numbers.

Analysis: The denial of credit rested only on the absence of pre-printed serial numbers on computer-generated invoices. The circular issued by the Board clarified that printing of running serial numbers on such invoices does not amount to breach of the rules and that denial of Modvat credit on that ground alone is not warranted. The Tribunal also applied the principle that the revenue cannot take a stand contrary to a binding circular.

Conclusion: Modvat credit could not be denied solely on the ground that the invoices were computer-generated and did not bear pre-printed serial numbers, and the issue was decided in favour of the assessee.

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