Deemed Modvat credit on scrap accepted when bills and challans were produced for verification and supported the claim.

Deemed Modvat credit on iron and steel scrap was treated as admissible where the assessee produced bills and challans and made them available for departmental verification. The dispute centred on whether the assessee had to prove actual duty payment on the inputs or whether documentary support and readiness for verification were sufficient. Relying on the facts and cited Tribunal decisions on similar issues, the availability of purchase documents for verification was accepted as adequate support for the credit claim, and the matter was decided in favour of the assessee.

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Issues: Whether deemed Modvat credit on iron and steel scrap was admissible when the assessee produced bills and challans and offered them for verification.

Analysis: The assessee had taken the stand that the scrap purchases were supported by bills and challans and that the documents were available for verification by the department. The dispute turned on whether the initial burden lay on the assessee to prove actual duty payment on the inputs or whether production of purchase documents and readiness for verification was sufficient to sustain the credit claim. In view of the facts and the cited Tribunal decisions on identical issues, the availability of bills and challans for verification was treated as adequate support for the claim.

Conclusion: The deemed Modvat credit was held to be admissible and the issue was decided in favour of the assessee.

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