Cenvat credit through job workers requires compliance with mandatory exemption conditions; waiver of pre-deposit was refused.

Cenvat credit on inputs processed through job workers was held to depend on compliance with the mandatory condition that the job workers avail Notification No. 214/86-C.E.; where that pre-condition is not met, the credit benefit cannot be extended. The job workers here operated under a complete exemption under Notification No. 6/2000-C.E., so the essential requirement was not satisfied. The Board instruction relied on by the appellants did not override this condition, and the cited Supreme Court authorities supported the same approach. The appellants therefore failed to make out a prima facie case for waiver of pre-deposit, and the disputed amount was directed to be deposited.

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Issues: Whether the appellants had made out a prima facie case for waiver of pre-deposit in a dispute relating to admissibility of Cenvat credit on inputs used through job workers.

Analysis: The availment of Cenvat credit under Rule 57AB(1) depended on the job workers availing the benefit of Notification No. 214/86-C.E., which was treated as an essential pre-condition. The job workers in the present case were not operating under that exemption but under a complete exemption under Notification No. 6/2000-C.E. The Board instruction relied upon by the appellants did not waive this mandatory condition. The principle applied was that where the essential requirement of the rule or notification is not satisfied, the benefit cannot be extended, and the cited Supreme Court decisions supported that approach.

Conclusion: The appellants failed to establish a prima facie case for waiver of pre-deposit, and the entire disputed amount was directed to be deposited.

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