Modvat credit and capital goods claims supported only partial pre-deposit waiver, not full relief.

Prima facie entitlement to Modvat credit on finger tips was treated as arguable, and the alternative claim that the items qualified as capital goods was also noted. On that assessment, complete waiver of pre-deposit of duty and penalty was not granted. Instead, only a conditional partial waiver was allowed for hearing the appeal, with a direction to deposit Rs. 50,000 within six weeks.

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Issues: Whether the appellant was entitled to total waiver of pre-deposit of duty and penalty, and whether only a conditional partial waiver should be granted.

Analysis: The claim for Modvat credit on finger tips was treated as arguable at the prima facie stage. The alternative plea that the items could be regarded as capital goods was also noted. On that assessment, the matter was not considered fit for complete waiver of the duty and penalty demanded.

Conclusion: Total waiver of pre-deposit was declined and the appellant was directed to deposit Rs. 50,000 within six weeks, with waiver of the remaining duty and penalty for the purpose of hearing the appeal.

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