Modvat credit on part-delivery challan upheld where credit matched the quantity actually delivered and no substantial question arose.

Modvat credit could not be denied where the challan covered only part of the consignment but the claim was confined to the quantity actually delivered under an identifiable voucher. The Tribunal's acceptance of the endorsed challan as a valid basis for the limited credit was treated as a possible and fair view, and no violation of law was shown. On that basis, the Court found that no substantial question of law arose for reference, and the Revenue's challenge failed.

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Issues: Whether Modvat credit could be denied on the ground that the challan covered only part of the consignment and whether any substantial question of law arose for reference.

Analysis: The quantity sold to the respondent was specified, and the credit was claimed only for the quantity actually delivered to it. The Tribunal's view that the endorsed challan was a valid basis for the limited credit claimed was held to be just and fair. The Court also noted that two departmental authorities had taken a possible view and that no violation of law was shown. In that situation, no substantial question of law requiring reference was made out.

Conclusion: The issue was decided against the Revenue and in favour of the assessee; the challan-based Modvat credit claim was sustained and the petition was dismissed.

Ratio Decidendi: Where Modvat credit is claimed only for the quantity actually delivered under a duly identifiable voucher and the departmental authorities have taken a possible view, no substantial question of law arises for reference.

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