Modvat credit dispute in stay proceedings led to partial pre-deposit and waiver of the balance demand.

In a stay application concerning Modvat credit, the applicants sought complete waiver of pre-deposit and stay of recovery on the basis that the duty demand arose from disputed invoices and receipt of goods. The Revenue opposed waiver, relying on the later insertion of the appellant's name in the invoices and the absence of intimation to the excise authorities, and contended that credit was not admissible without proper compliance. The Tribunal granted only partial relief, directing a deposit of Rs. 80,000 and staying recovery of the balance demand during pendency of the appeal.

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Issues: Whether, in the stay application, the applicants were entitled to complete waiver of pre-deposit of the duty demand and stay of recovery during pendency of the appeal.

Analysis: The applicants sought full dispensation of pre-deposit on the ground that the duty demand arose from disputed invoices and that the goods had been received. The Revenue opposed the request by pointing to subsequent insertion of the appellant's name in the invoices and non-intimation to the excise authorities, contending that the Modvat credit was not admissible without proper compliance.

Outcome: The Tribunal directed deposit of Rs. 80,000 towards duty and granted waiver and stay of the balance demand during the pendency of the appeal.

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