Per Sh. S.K. Bhatnagar : These are stay applications filed by two different, appellants against two different orders but both the sides submit that the issue involved is the same.

2. In both the cases the goods received as inputs by the appellants were the ones which had been manufactured by IPCL but were not received directly from IPCL; instead the IPCL had sent the consignments to their stockists/dealers and the later had subsequently sold it to the appellants. In the process the goods had travelled from Vadodra to Jaipur and from there to the appellants unit at Jaipur.

3. As a result the gate pass issued by IPCL had to be first endorsed to the godowns under the stockists and then from there to the appellants. In both the cases the original gate passes has since been endorsed by the stockists.

4. Same of these gate passes cover the entire consignment cleared from IPCL where as some of them cover part consignment.

5. A question has arisen whether the procedure which has been followed is correct and if not whether the errors or omissions were such which will call for denial of modvat benefit.

6. It was their submission that there is no doubt or dispute that the inputs as well as the outputs were declared items and the inputs received on gate pass had been utilised for the manufacture of the declared outputs.

7. It was also their contention that in case the department felt that instead of endorsement on the gate pass subsidiary gate pass should have been obtained the appellant would have been so advised. Similarly if there was any other curable defect the same should have also been directed to be rectified and they would have willingly done so and in fact after the case came on Board last time they got the endorsements made after taking time from the Tribunal.

8. In these circumstances the pre-deposit may be waived and the appeals may be accepted.

9. Ld. Counsel also drew attention to the agreement between the IPCL and the stockists and to the clauses therein relating to the non-temptering of the goods and its packing and the continuation of the vesting of title in the IPCL till sold.

10. Ld. JCDR and Id. DR stated that the modvat has been denied because the appellants have not followed the procedure strictly. Normally in such cases subsidiary gate passes should have been issued and obtained which has not been done. Similarly, more than two endorsements are not permissible and the endorsed gate passes are acceptable only in case of whole consignment and not part consignment as per the Government Circular.

11. They have no objection if the appeals are also considered today itself.

12. We have considered above submissions.

13. We take note of the agreement between IPCL and the appellants and the clauses thereof in this connection. We also note that there is no charge of violation of such conditions or indication of any evidence of tempering of the goods or packing.

14. We find that this Tribunal has repeatedly observed, that a substantial benefit should not be denied for minor procedural infractions and if there were some minor curable defects, it was up to the departmental authorities to get those defects rectified and advise the licencee/assessee suitably or take such other precautions as may be called for in a given situation; and if necessary verify the facts with reference to the records, rules & goods. Since in the present case the appellants have already obtained the necessary endorsements on the original gate passes after obtaining time from the Tribunal for this purpose and have filed the copies thereof, we waive the pre-deposit of the amounts in question.

15. Further taking up the main appeals we accept them in view of a catena of orders of this Tribunal on the above points with the observation that it will be open to the proper officers concerned to take any further precaution as may be necessary.