Modvat credit on manufacturer invoices and subsidiary gate passes upheld where duty-paid entitlement was established.

Modvat credit was held admissible on manufacturer's invoices even though they were not pre-authenticated, because the invoices were genuine and the duty-paid nature of the goods was not disputed. Credit also could not be denied merely because the goods were accompanied by subsidiary gate passes, since the Bills of Entry otherwise supported entitlement and the gate passes were only supporting documents. The impugned order was sustained and the Revenue's challenge failed.

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Issues: (i) Whether Modvat credit was admissible on manufacturer's invoices not pre-authenticated. (ii) Whether Modvat credit could be denied on the basis that the goods were accompanied by subsidiary gate passes.

Issue (i): Whether Modvat credit was admissible on manufacturer's invoices not pre-authenticated.

Analysis: The invoices were manufacturer's invoices and did not require pre-authentication. The duty-paid nature of the goods was not in dispute.

Conclusion: Modvat credit on the invoices was admissible, in favour of the assessee.

Issue (ii): Whether Modvat credit could be denied on the basis that the goods were accompanied by subsidiary gate passes.

Analysis: The goods had been imported under Bills of Entry on which credit was otherwise available. The subsidiary gate passes issued by the department were only supporting documents and not the sole basis of credit.

Conclusion: Credit could not be denied on this ground, in favour of the assessee.

Final Conclusion: The impugned order was sustained and the Revenue's challenge failed.

Ratio Decidendi: Modvat credit cannot be denied merely because manufacturer's invoices were not pre-authenticated or because subsidiary gate passes accompanied goods when the duty-paid nature of the goods and the underlying entitlement to credit are established.

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