Modvat credit cannot be denied on conjecture where a verified departmental certificate is unsupported by contrary evidence.

Modvat credit could not be denied on a mere presumption that a certificate issued by a departmental officer did not relate to the inputs received. The certificate had been issued under Rule 57G of the Central Excise Rules, 1944 after verification of the original duty paying documents, and the appellate doubt was unsupported by any evidence. In the absence of material showing that the certificate was contrary to law or unrelated to the inputs, denial of credit on conjecture was unsustainable. The note states that the denial of Modvat credit was not justified and that the appeal was allowed with consequential relief.

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Issues: Whether Modvat credit could be denied on a mere presumption that the certificate issued by the departmental officer did not relate to the inputs received, when there was no evidence on record to disprove its genuineness.

Analysis: The doubt expressed in the appellate order was found to be unsupported by evidence. The certificate had been issued by a departmental officer under Rule 57G of the Central Excise Rules, 1944 after verification of the original duty paying documents. In the absence of material showing that the certificate was issued contrary to law or was unrelated to the inputs, the denial of credit based on conjecture could not be sustained.

Conclusion: The denial of Modvat credit was not justified, and the appeal was allowed with consequential relief.

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