Assessable value of UPS batteries and pre-deposit waiver treated as arguable, with partial deposit and remand ordered.

Dispute concerned whether the value of bought-out batteries, cleared separately and fitted at the customer's premises, had to be included in the assessable value of UPS systems. Tribunal decisions were noted to be divided: one view excluded such value where the battery was not supplied with the UPS, while another treated the battery as an essential component whose value was includible. In that uncertain legal position, the matter was treated as arguable rather than settled. Full waiver of pre-deposit was declined; partial deposit was ordered, with the balance of duty and penalties waived and recovery stayed upon compliance, and the appeals were remanded for decision on merits without further pre-deposit.

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Issues: Whether the appellants were entitled to full waiver of pre-deposit in view of the dispute regarding inclusion of the value of batteries in the assessable value of UPS systems, and whether the matter required remand for decision on merits.

Analysis: The dispute turned on whether the value of a bought-out battery, cleared separately and fitted at the customer's premises, was includible in the assessable value of the UPS. Earlier Tribunal decisions took differing approaches: one line treated the value as excludible where the battery was not supplied along with the UPS, while another treated the battery as an essential component whose value had to be included. In the face of this uncertainty, the issue was treated as arguable rather than settled. Since the Commissioner (Appeals) had not decided the appeals on merits and had insisted on full pre-deposit, it was to grant only partial waiver and to remand the matters for fresh adjudication after compliance with the ordered deposit.

Conclusion: Full waiver of pre-deposit was declined. The appellants were directed to pre-deposit Rs. 10,00,000 and, on such deposit, the balance of duty and penalties stood waived and recovery stayed. The matters were remanded to the Commissioner (Appeals) to decide the appeals on merits without insisting on any further pre-deposit once proof of deposit was produced.

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