Brand name exemption and pre-deposit relief turned on weak prima facie case but financial hardship justified partial waiver.

Use of another person's brand name can defeat a claim to small-scale industry exemption, and the record here showed only a limited right to manufacture and market under a Sri Lankan company's brand. That meant the appellant could not establish a strong prima facie case for total waiver of pre-deposit. However, substantial net losses in the balance sheet evidenced financial hardship, so CESTAT took a lenient approach and balanced the weak prima facie case against hardship by granting only partial relief on pre-deposit rather than full waiver.

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Issues: Whether waiver of the entire pre-deposit of duty could be granted in a case involving denial of small-scale industry exemption on the ground of use of another person's brand name, and whether financial hardship justified a reduced pre-deposit.

Analysis: The goods were cleared under a brand name belonging to a Sri Lankan company, and the record showed that the appellant had been given only the right to manufacture and market products under that brand name. On that basis, the appellant did not establish a strong prima facie case for total waiver. At the same time, the balance sheet showed substantial net losses, indicating financial difficulty. The Tribunal therefore took a lenient view on pre-deposit and balanced the limited prima facie case against hardship.

Conclusion: The appellant was not granted full waiver, but was directed to pre-deposit Rs. 5,00,000, thereby obtaining only partial relief.

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