Chassis value exclusion in fabricated motor vehicles supports prima facie waiver of pre-deposit under excise exemption rules.

Where motor vehicles are fabricated on chassis supplied by customers and no Cenvat credit is taken on the duty paid on the chassis, the assessable value for excise exemption and aggregate clearance computation is to be confined to the fabrication work and need not include the chassis value. On that basis, the Revenue's objection was found prima facie unsustainable, and the appellant was held to have established a prima facie case for waiver of pre-deposit. The waiver application was allowed and recovery was stayed pending disposal of the appeals.

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Issues: Whether the appellant made out a prima facie case for waiver of pre-deposit in a dispute concerning inclusion of chassis value in the assessable value and aggregate value of clearances for excise exemption purposes.

Analysis: The dispute turned on whether, where motor vehicles are fabricated on chassis supplied by customers and no Cenvat credit is taken on the duty paid on chassis, the value of the chassis must be included in the value of the fabricated motor vehicle for the purpose of exemption and aggregate clearance computation. The Tribunal noted that under the tariff and the relevant exemption notification, the duty liability on such fabricated motor vehicles was to be determined on the value of the fabrication work, excluding the chassis value when the credit condition was not availed. On that basis, the Revenue's objection was found to be prima facie misplaced.

Conclusion: The appellant was held to have established a prima facie case for waiver of pre-deposit.

Final Conclusion: The application for waiver of pre-deposit was granted and recovery was stayed pending disposal of the appeals.

Ratio Decidendi: For waiver purposes, where the tariff structure and exemption conditions indicate that the chassis value is not to be included when no Cenvat credit on the chassis duty is taken, a prima facie case exists for relief from pre-deposit.

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