Exemption under Sub-Heading 4802.20 failed for lack of proof of conditions, so full duty pre-deposit was ordered.

Exemption for paper board cleared under Sub-Heading 4802.20 depended on strict compliance with Chapter 48, Sub-heading Note No. 2, including a valid KVIC certificate and proof of the prescribed manufacturing conditions. The certificate produced related to an earlier period and had a one-year validity, while the claim regarding the cylinder mould vat was unsupported by evidence; the returns also failed to disclose the relevant manufacturing process. On this material, the finding of suppression was treated as reasonable, and no prima facie case for full waiver of pre-deposit was made out. The appellants were required to pre-deposit the entire duty amount, and recovery of penalty was stayed pending the appeals.

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Issues: Whether the appellants had made out a prima facie case for waiver of pre-deposit and stay of recovery of duty and penalty, and whether the demand based on classification under Sub-Heading 4802.20 could be interfered with at the interim stage.

Analysis: The duty demand arose from clearance of paper board without payment of duty while claiming exemption under Sub-Heading 4802.20. The statutory benefit was subject to compliance with the conditions in Sub-heading Note No. 2 in Chapter 48, including production of a valid KVIC certificate and satisfaction of the prescribed manufacturing conditions. The certificate produced was for an earlier period and was valid only for one year, and the claim regarding the cylinder mould vat was unsupported by evidence. The returns filed did not disclose the manufacturing process relevant to the exemption claim, and the finding of suppression recorded in the impugned order was found to be reasonable.

Outcome: The appellants were directed to pre-deposit the entire duty amount within four weeks, while recovery of penalty was stayed till disposal of the appeals.

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