Pre-deposit waiver and exemption notification interpretation fail where the circular relied on does not match the notification conditions.

Waiver of pre-deposit was refused because the applicants did not establish a prima facie case for exemption under Notification No. 69/86-C.E. The notification required the inputs to have suffered duty at the prescribed rate, while the CBEC circular relied on covered a different exemption condition involving goods manufactured from goods on which appropriate duty had already been paid. As the circular was not applicable to the notification and no prima facie entitlement was shown, pre-deposit of the entire duty demand was directed.

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Issues: Whether the applicants had made out a prima facie case for waiver of pre-deposit of the duty demand by relying on the exemption notification and the CBEC circular.

Analysis: The exemption claimed under Notification No. 69/86-C.E. was conditioned upon the inputs having suffered duty at the prescribed rate. The circular relied upon dealt with a different type of exemption condition, namely goods manufactured from other goods on which appropriate duty had already been paid, and was therefore not applicable to the present notification. In the absence of a prima facie case, and considering the amount involved, pre-deposit of the entire duty demand was directed.

Conclusion: The request for waiver of pre-deposit was rejected and the appellants were directed to deposit the entire duty amount.

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