Modvat credit requires genuine duty-paying invoices and input declarations; self-issued documents do not support credit.

Modvat credit was denied because the documents relied on were not shown to be genuine duty-paying invoices issued by TISCO. The Tribunal found that the papers bore the appellant's own name and signature of its authorised signatory, while the consignor and consignee entries did not establish external issuance. The appellant's claim that it operated as separate conversion-agent and manufacturing entities was rejected, and no supporting authority, contract, or input declaration was produced. On that basis, the credit claim lacked legal foundation and the denial of credit, together with the penalty, was upheld.

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Issues: Whether Modvat credit could be availed on the basis of documents claimed to be invoices issued by TISCO when the documents were found to have been issued by the appellant itself and no supporting authority, contract, or declaration of inputs was produced.

Analysis: The appellant's plea that it functioned as two separate entities, namely a conversion agent and an independent manufacturer, was rejected. The documents relied upon for credit bore the appellant's name and were signed by its authorised signatory, while the purported consignor and consignee entries did not establish that they were invoices issued by TISCO. In the absence of proof that the documents were genuine duty-paying invoices issued under the relevant rules, and without evidence of any declaration treating the goods as inputs, the credit claim lacked legal foundation.

Conclusion: Modvat credit was not admissible and the denial of credit was upheld against the assessee.

Final Conclusion: The appeal failed, and the order denying Modvat credit and sustaining penalty remained undisturbed.

Ratio Decidendi: Credit under the Modvat scheme cannot be allowed unless supported by a genuine and valid duty-paying document and the requisite compliance with the input-declaration requirements.

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