CENVAT credit and depreciation overlap was cured by revised returns and supporting records, making the demand unsustainable.

CENVAT credit on capital goods was examined against simultaneous depreciation claimed under section 32 of the Income-tax Act, 1961. Revised income-tax returns, acknowledgment of filing, and an auditor's certificate were treated as sufficient evidence that the mistaken double benefit had been rectified. On that basis, the demand was found unsustainable and the assessee was held entitled to succeed.

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Issues: Whether CENVAT credit could be denied on capital goods on the ground that depreciation had also been claimed under section 32 of the Income-tax Act, 1961, and whether filing revised income-tax returns with acknowledgment showed sufficient rectification to nullify the demand.

Analysis: The appellant produced revised returns filed before the Income-tax Department, acknowledgment of receipt of those returns, and an auditor's certificate. These materials were treated as evidence that the mistake in simultaneously availing CENVAT credit and depreciation had been corrected. In these circumstances, the demand was considered unsustainable.

Conclusion: The demand was not sustainable and the assessee succeeded.

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