1994 (8) TMI 113 - AT - Central Excise

Summary

Issues:
Appeal against disallowance of Modvat Credit due to declaration not filed in Divisional Office.

Analysis:
The appellant, engaged in manufacturing certain products, filed a Modvat declaration with the Range Office, indicating the use of specific inputs in their final product. Despite this, a demand was raised alleging wrongful availing of Modvat credit for steel ingots, as the declaration was not filed with the Asstt. Collector of Central Excise. The Asstt. Collector upheld the demand, citing non-receipt of the declaration in the Divisional Office.

The appellant argued that filing the declaration with the Range Office, a part of the Asstt. Collector's establishment, should suffice as compliance. They contended that the purpose of the declaration is to enable the Department to verify Modvat eligibility, not to restrict credit based on administrative technicalities. Reference was made to a case highlighting the importance of the declaration for verification purposes.

In response, the Revenue emphasized the mandatory nature of a specific declaration, as established in previous judgments. However, the Tribunal noted that the Modvat declaration was indeed submitted, including additional inputs, and there was no dispute regarding the eligibility of these inputs for Modvat credit. The Tribunal relied on precedents to support the view that filing the declaration with the Range Office, being part of the Asstt. Collector's office, constituted substantial compliance with the legal requirement.

The Tribunal, considering the substantive benefit of Modvat credit and the technical nature of the filing requirement, set aside the impugned order and allowed the appeal. It was held that denial of the credit solely on technical grounds, when the declaration was in fact filed and the inputs were eligible, would be unjust. The issue of time bar was not addressed due to the appeal's success.