Modvat credit on scrap inputs denied where duty payment was not documented and deemed credit was unavailable.

Modvat credit on scrap inputs was denied because the supplier's certificate and sale documents did not establish the exact duty paid or the rate of duty, and the assessee produced no documentary evidence proving duty payment on the inputs. The Tribunal held that there was no provision permitting deemed credit for item No. 7204 under Order No. 342/1/88-TRU dated 20-5-88, so credit was inadmissible and the disallowance was upheld.

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Issues: Whether Modvat credit was admissible on inputs purchased as scrap on the basis of the supplier's certificate and the absence of particulars showing the exact duty paid.

Analysis: The inputs were purchased from a public sector supplier whose sale documents described the goods as duty paid, but the records did not show the amount of duty or the rate at which it had been paid. The appellant availed credit at the lowest rate of duty on the footing of the supplier's certificate. The Tribunal noted that there was no provision permitting deemed credit for item No. 7204 under Order No. 342/1/88-TRU dated 20-5-88, and that the appellant had not produced documentary evidence establishing payment of duty on the inputs.

Conclusion: Modvat credit was not admissible, and the disallowance was upheld against the assessee.

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