Customs exemption and interim relief for capital goods used in software development for export supported waiver of pre-deposit.

An exemption claim under Notification No. 140/91-Cus. was examined in relation to imported goods used for software development for export. The adjudicating authority denied the benefit on the basis that the items were not capital goods, while the appellate authority accepted them as capital goods but raised a different objection on end use. A Chartered Engineer's certificate supported the stated use. In light of the appellate finding on the nature of the goods and the supporting evidence, interim relief was considered justified and the stay application was allowed with waiver of pre-deposit.

---

---

Issues: Whether the appellants were entitled to waiver of pre-deposit and stay of recovery proceedings in respect of the disputed customs duty.

Analysis: The exemption claim was based on Notification No. 140/91-Cus. dated 22-10-1991. The adjudicating authority had denied the benefit on the footing that the imported items were not capital goods, while the appellate authority had accepted them as capital goods but raised a different objection regarding use for development of software for export. The record also contained a Chartered Engineer's certificate supporting such use. In these circumstances, and in view of the appellate authority's finding on the nature of the goods as capital goods, the application for interim relief was considered fit for grant.

Conclusion: The stay application was allowed and pre-deposit was waived.

---