Input duty credit cannot be denied for technical lapses when duty-paid inputs are verifiable and credit exceeds the demand.

Procedural objections cannot defeat input duty credit where duty-paid inputs are verifiable and the assessee's entitlement can be established from invoices and contemporaneous records. The Tribunal noted that, on the jointly worked-out figures, admissible credit exceeded the confirmed duty demands even after the required reversal for exempted clearances and goods cleared under small-scale exemption. As the appellants undertook not to claim any further credit or cash refund, the dispute was treated as capable of final resolution without remand. No net duty demand survived, and the duty, interest, and penalty demands were set aside.

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Issues: Whether the appellants were entitled to input duty credit despite procedural objections, and whether any net duty demand, interest, or penalty survived after adjusting the admissible credit.

Analysis: The Tribunal relied on the principle that denial of input duty credit cannot rest on technical non-compliance where the assessee had genuinely claimed non-dutiability and the duty-paid nature of inputs could be verified. The departmental verification of invoice copies and contemporaneous reports showed that the duty on inputs used in manufacture could be ascertained. On the jointly worked-out figures, the admissible credit exceeded the quantified duty demands even after making the required reversal in respect of exempted clearances and goods cleared under small-scale exemption. Since the appellants undertook not to claim any balance credit or cash refund, the dispute could be finalized without further remand.

Conclusion: The appellants were entitled to the benefit of input duty credit, and no net duty demand survived; consequently, the demands of duty, interest, and penalty were set aside.

Ratio Decidendi: Where duty-paid inputs are verifiable and admissible credit exceeds the confirmed demand, procedural lapses in claiming credit cannot defeat substantive relief, and the resultant duty, interest, and penalty liabilities do not survive.

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