Endorsed Bill of Entry treated as valid duty-paying document for Modvat credit on imported inputs.

Modvat credit on imported inputs could not be denied merely because the Bill of Entry was endorsed in the importer's favour and the goods were not originally consigned in its name. The Tribunal treated the endorsed Bill of Entry as a valid duty-paying document under the Modvat scheme, noting that endorsed gate passes and endorsed Bills of Entry were recognised for credit at the relevant time. Because the goods had reached the appellant's factory in original condition after customs clearance and duty had been borne on import, the absence of a subsidiary certificate was not a valid ground to refuse credit. The denial of Modvat credit was therefore unsustainable.

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Issues: Whether Modvat credit on imported inputs could be denied merely because the Bill of Entry was endorsed in the appellant's favour and the goods were not originally consigned in the appellant's name.

Analysis: The inputs were received in the appellant's factory as the entire consignment in the original state after customs clearance. The Tribunal noted that, at the relevant time, endorsed gate passes and endorsed Bills of Entry were recognised documents for availing credit under the Modvat scheme. In the facts of the case, the endorsed Bill of Entry was treated as a valid duty-paying document, and the absence of a subsidiary certificate was not regarded as a reason to deny the credit when the goods had admittedly reached the appellant and duty had been borne on the import.

Conclusion: The appellant was entitled to Modvat credit, and the denial of credit was unsustainable.

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