Judgment:
2. The dispute is in regard to Modvat credit taken by the respondent under Notification No. 29/2000-C.E. (N.T.), dated 31-3-2000. Revenue seems to deny credit on the ground that the respondents' supplier had not paid duty for the inputs in question. The contention of the respondent is that since the Notification had declared the inputs in question as deemed to have paid duty, the actual payment of duty was not open to be verified and made a ground for denial of credit. I am in agreement with the respondents' contention. Para 2 of the said Notification makes this position clear. That para reads as under :- "The Central Government further declares that the duty of excise under the Central Excise Act, 1944 (1 of 1944) (hereinafter referred to as said Act,) shall be deemed to have been paid (hereinafter referred to as deemed duty), on the inputs declared herein and the same shall be equivalent to the amount calculated at the rate of twelve per cent of the price, as declared by the manufacturer in the invoice accompanying the said inputs (hereinafter referred to as invoice price), and credit of the deemed duty so determined shall be allowed to the manufacturer of the final products." 3. In view of the declaration made under the above para that the goods shall be deemed to have paid duty, it was not open to the Revenue to challenge the credit taken on the ground of non-payment of duty. The appeal fails and is rejected.