Cenvat credit utilisation limits: additional excise duty credit could not be fully set off against basic excise duty.

Credit of additional excise duty was examined for use against basic excise duty under the Cenvat scheme, but no provision in the Cenvat Credit Rules was identified permitting such utilisation. The only express relief noted was rebate or refund under Rule 5 for accumulated credit linked to inputs used in export goods. On that prima facie basis, complete waiver of pre-deposit was not justified at the interim stage, and only partial relief was considered appropriate. The balance demand was stayed subject to compliance with the directed deposit.

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Issues: Whether credit of additional excise duty could be utilized towards payment of basic excise duty and whether the appellant was entitled to waiver of pre-deposit beyond the amount directed.

Analysis: The available material showed no provision in the Cenvat Credit Rules permitting utilization of credit of additional excise duty for payment of basic excise duty. The only express relief referred to was rebate or refund under Rule 5 for accumulated credit relating to inputs used in export goods. On that prima facie view, the appellant did not establish a case for complete waiver of the duty demand at the interim stage.

Conclusion: The contention that the credit could be used against basic excise duty was not accepted for the purpose of full waiver, and partial pre-deposit was directed.

Final Conclusion: Interim relief was granted only to a limited extent, with the balance demand stayed pending the appeal upon compliance with the directed deposit.

Ratio Decidendi: In the absence of a statutory provision permitting use of credit of additional excise duty against basic excise duty, complete waiver of pre-deposit is not warranted at the prima facie stage.

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