Modvat credit on resin used for sand moulds found prima facie admissible, supporting stay and waiver of pre-deposit.

Modvat credit on resins used in the manufacture of sand moulds for castings was treated as a debatable eligibility issue because earlier decisions on chemicals and resins used in sand mould and sand core production supported admissibility where the inputs formed part of the process leading to the final product. Applying the broader meaning of input used in the manufacture of, the Tribunal found a prima facie case in favour of the applicants for stay and waiver of pre-deposit. Stay was therefore granted, subject to execution of a personal bond for the disputed amount.

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Issues: Whether the applicants made out a prima facie case for stay and waiver of pre-deposit in respect of the disputed Modvat credit on resins used in the manufacture of sand moulds for castings.

Analysis: The competing decisions on Modvat eligibility for chemicals or resins used in making sand moulds were noted. Later Tribunal decisions, including one dealing with chemicals used for production of sand cores and sand moulds, supported admissibility of benefit where such inputs were used in the process leading to the final product. The order treated these later rulings, together with the wider principle governing the expression used in the manufacture of, as sufficient to show a debatable issue on merits and a prima facie case in favour of the applicants.

Conclusion: The applicants were held to have made out a prima facie case, and stay was granted subject to execution of a personal bond for the disputed amount.

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