Modvat credit denied on invoices from an unregistered dealer because registration was mandatory for valid duty paying documents.

Invoices issued by an unregistered dealer before December 1994 were not valid duty paying documents for Modvat credit because Notification No. 32/94 required dealers and traders to obtain registration, and the departmental instructions treated invoices as regularisable only if registration was secured on or before 31-12-1994. As the dealer remained unregistered by that date, the mandatory condition for validity of the invoices was not met, and Modvat credit was rightly denied.

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Issues: Whether invoices issued before December 1994 by an unregistered dealer were valid duty paying documents so as to permit Modvat credit.

Analysis: Notification No. 32/94 required dealers and traders to obtain registration, and the departmental instructions and clarifications treated invoices as capable of regularisation only if the dealer or trader obtained registration on or before 31-12-1994. The respondent did not get itself registered even by that date, and the mandatory requirement for a valid invoice was therefore not satisfied.

Conclusion: The invoices issued by the unregistered dealer were not valid duty paying documents and Modvat credit was rightly denied.

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