Compounded Levy Scheme eligibility and duty computation support only partial pre-deposit waiver at the stay stage.

Eligibility for the Compounded Levy Scheme and the duty computation were examined at the stay stage, with the tribunal finding a prima facie case only in part. The existence of an open-air stentor during the relevant period weighed against the applicants on scheme eligibility, while the objection that spares and accessories should be included in the value of plant and machinery carried limited force. The claim relating to deemed CENVAT credit also supported partial relief. On that basis, partial waiver of pre-deposit was granted subject to a deposit condition, and the balance demand was stayed pending appeal.

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Issues: Whether the applicants made out a prima facie case for waiver of pre-deposit in proceedings concerning eligibility to the Compounded Levy Scheme and the computation of duty demand.

Analysis: The dispute concerned eligibility under the Compounded Levy Scheme introduced by the notification and the relevant excise rules. Prima facie, the presence of an open-air stentor hit the applicants for the period during which that facility remained in existence, while the objection based on inclusion of spares and accessories in the value of plant and machinery was not found to have much merit. The claim for deemed CENVAT credit also supported partial relief at the stay stage.

Conclusion: The applicants were granted partial waiver of pre-deposit on condition of depositing Rs. 35 lakhs, with balance dues stayed pending the appeal.

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