Validity of Gate Pass for Modvat Credit Denied Post 30-6-1994

Issues: Whether Modvat credit could be availed on the strength of gate passes issued before 1-4-1994 where the credit was taken after 30-6-1994.

Analysis: Rule 57G(2) permitted Modvat credit only on the basis of specified duty paying documents. Gate pass was not one of the prescribed documents, except to the limited extent provided by the Government's transitional notification, which validated such gate passes only if credit was taken on or before 30-6-1994. The Board circular relied upon by the assessee related to a different notification concerning invoices and did not extend the benefit to the present case. The prescribed manner for availing credit had to be strictly followed.

Conclusion: Modvat credit on the gate passes taken after 30-6-1994 was not admissible and the disallowance was upheld against the assessee.

Ratio Decidendi: Where a taxing rule prescribes specific duty paying documents for Modvat credit, credit cannot be allowed on a document outside that prescription beyond the limited transitional relaxation expressly granted.