Modvat credit on capital goods: prima facie eligibility sustained for material handling equipment, but tyres failed declaration requirement.

Truck loading machine was treated as material handling equipment used in the factory, and the record did not displace the prima facie view that it qualified as capital goods for Modvat credit. The other disputed goods were also found prima facie eligible during the relevant period, supporting stay to that extent. Credit on tyres, however, was not sustained because they were not shown to be eligible as capital goods and the required declaration remained unproved. Partial pre-deposit was therefore directed, with stay granted only on compliance for the balance.

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Issues: Whether, for the purpose of waiver of pre-deposit and stay, the disputed items were prima facie eligible for Modvat credit as capital goods under Rule 57Q, and whether the credit on tyres could be sustained when no declaration under Rule 57T had been made.

Analysis: The Truck Loading Machine was treated as material handling equipment used in the factory, and there was no evidence to dislodge the prima facie view that it qualified as capital goods. The other disputed goods were also found prima facie eligible for credit during the relevant period. In contrast, the credit on tyres was denied not only on the ground of ineligibility under Rule 57Q but also because the required declaration under Rule 57T had not been shown, which remained unrebutted at the interim stage. On that basis, partial pre-deposit was considered appropriate.

Conclusion: The appellant was granted only partial relief, with pre-deposit required for part of the disputed amount and stay available for the balance on compliance.

Ratio Decidendi: For interim relief in Modvat matters, where some inputs or goods are prima facie shown to be eligible as capital goods but a separate statutory requirement such as declaration is not met for a distinct item, the Tribunal may direct partial pre-deposit and limit stay accordingly.

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