Modvat credit cannot be denied for a formal document name mismatch when goods are received and used in the factory.

Procedural Board circulars on Modvat documentation were treated as binding on departmental authorities and as applying retrospectively. Where imported goods were actually received at the factory and used there, and the invoice and bill of entry were endorsed to the manufacturing unit, credit was not to be denied merely because the original documents named the registered office instead of the factory. The documentary defect was held to be formal, not substantive, and the Modvat credit claim was accepted.

---

---

Issues: Whether Modvat credit could be denied merely because the bill of entry and invoice were issued in the name of the registered office instead of the factory, when the goods were received at the factory and the invoice was endorsed to the manufacturing unit; and whether the Board's circular on the procedural requirement operated retrospectively and was binding on the departmental authorities.

Analysis: The circular issued by the Board on the point was treated as binding on the authorities, and a procedural direction in such circular was held to apply retrospectively. The invoice and bill of entry were subsequently endorsed to the factory, the factory address also appeared on the invoice, and there was no dispute that the imported goods reached the factory and were utilised there. In these circumstances, denial of credit solely on the ground that the documents were initially in the name of the registered office was not justified.

Conclusion: The objection raised by Revenue was rejected and Modvat credit was held admissible in favour of the assessee.

Ratio Decidendi: Procedural circulars issued by the Board are binding on departmental authorities and operate retrospectively, and Modvat credit cannot be denied when the goods are actually received and used in the factory and the documentary defect is only in the initial naming of the registered office.

---