CESTAT Grants Waiver of Pre-Deposit for Haryana Govt Undertaking

The Appellate Tribunal CESTAT, New Delhi granted waiver of pre-deposit of duty amount in two appeals where the appellants, a Haryana State Government Undertaking, were denied deemed Modvat credit for not receiving goods directly from the manufacturer and not making payment directly to the manufacturer. The tribunal found that the appellants had a strong prima facie case as there was no dispute regarding the receipt of goods by the appellants and their duty paid character. The tribunal waived the pre-deposit requirement in both appeals, with recovery stayed pending appeal disposal, scheduled for a hearing on 23rd January 2004.

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Issues: Waiver of pre-deposit of duty amount in two appeals due to denial of deemed Modvat credit based on goods not being received directly from the manufacturer and payment not made directly to the manufacturer.

The judgment by the Appellate Tribunal CESTAT, New Delhi involved the issue of waiver of pre-deposit of duty amount in two appeals where the appellants were denied deemed Modvat credit for not receiving goods directly from the manufacturer and not making payment directly to the manufacturer. The appellants, a Haryana State Government Undertaking, placed orders for goods with Steel Authority of India, who then directed the manufacturer, M/s. Karam Steel Corpn., to supply the goods to the appellants. Initially, the invoice was issued in the name of Steel Authority of India, but it was later amended to reflect the appellants as the consignee. The tribunal noted that there was no dispute regarding the receipt of goods by the appellants and their duty paid character. Considering these facts, the tribunal found that the appellants had a strong prima facie case, and thus waived the requirement of pre-deposit of the duty amount in both appeals, with recovery stayed until the disposal of the appeals. The appeals were scheduled for regular hearing on 23rd January, 2004.

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