Modvat credit cannot be denied where the functional use of inputs in manufacture is undisputed and unchallenged.

Modvat credit was admissible on the disputed inputs because their functional use in relation to manufacture was not contested. The challenge was confined to four inputs, while no dispute survived regarding Radex and the two capital goods. The lower appellate authority's finding that Teeming Compound, APC/Ferrux, Nozzolax and Clean Flow were used in the manufacture of the final product was not challenged, and that uncontested finding supported credit eligibility. The Revenue's challenge therefore failed, and the order allowing Modvat credit was sustained.

---

---

Issues: Whether Modvat credit was admissible on Teeming Compound, APC/Ferrux, Nozzolax, Clean Flow, Radex, Castable and Boric Acid Powder.

Analysis: The challenge in the appeal was confined to four inputs, while no dispute survived in relation to Radex and the two capital goods. The functions of Teeming Compound, APC/Ferrux, Nozzolax and Clean Flow, as recorded by the lower appellate authority, were not disputed, and the finding that those items were used in relation to the manufacture of the final product was also not contested.

Conclusion: Modvat credit remained admissible on the disputed inputs, and the decision of the lower appellate authority was upheld.

Final Conclusion: The Revenue's challenge failed and the order granting Modvat credit was sustained.

Ratio Decidendi: Where the functional use of inputs in relation to manufacture is not disputed and the finding of such use is not challenged, credit cannot be denied.

---