Modvat credit survives loss of the Bill of Entry when timely intimation is given and statutory certification is sought.

Modvat credit was admissible where the duty-paying Bill of Entry was lost or misplaced, the loss was intimated within time, and no dispute existed as to receipt of goods or duty payment. Rule 57G(6), operating through a non-obstante clause, allowed credit on the basis of the proper officer's certificate when the prescribed document was unavailable for reasons beyond the assessee's control. The six-month restriction under Rule 57G(2) did not defeat credit on these facts, because the issue was governed by the special procedure for lost documents rather than a purely technical documentary objection. The demand for reversal was therefore not sustained.

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Issues: Whether Modvat credit could be sustained when taken on the strength of an exchange control copy of the Bill of Entry after the original relevant copy was lost or misplaced, and whether the six-month restriction under Rule 57G(2) barred such credit in the facts of the case.

Analysis: The relevant Bill of Entry was admittedly lost or misplaced, and intimation of such loss was given within time. Rule 57G(6) permits credit on the basis of a certificate issued by the proper officer where the triplicate copy is lost in transit, and the provision operates through a non-obstante clause. The reasoning applied in the larger bench ruling relied upon makes it clear that where the prescribed document is unavailable for reasons beyond the assessee's control, the insistence on strict documentary form is not a mere technicality, and credit may be taken pending decision on the loss application. The record also showed no grievance regarding receipt of goods or duty payment, and no separate ground was raised regarding utilisation of the credit.

Conclusion: The credit was held to be admissible and the assessee's position was accepted on this issue.

Final Conclusion: The demand for reversal of Modvat credit was not upheld, and the Revenue's challenge failed.

Ratio Decidendi: Where the prescribed duty-paying document is lost and the assessee intimates the loss within time, Modvat credit is not defeated by a purely technical objection and may be taken pending issuance of the certificate contemplated by the rules, subject to the statutory scheme governing its utilisation.

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