2003 (10) TMI 329 - AT - Central Excise

Summary

Issues: Application for waiver of pre-deposit of duty and penalty on the Proprietor arising from the order of the Commissioner of Central Excise (Appeals), Surat regarding the demand confirmed on clearances of Knitted Fabrics of Man Made Fibres without payment of duty.

The judgment addresses the application for waiver of pre-deposit of duty and penalty amounting to Rs. 12,99,485.56 and Rs. 12,99,000/- respectively on the Proprietor following the order of the Commissioner of Central Excise (Appeals), Surat. The demand in question pertains to clearances of Knitted Fabrics of Man Made Fibres falling under Chapter Heading No. 60.02, manufactured with the aid of power during the period from 24-9-97 to 12-4-99 without payment of duty.

In the absence of representation from the applicants despite notice, the tribunal heard the ld. JDR and examined the records. The department's case for duty payment is based on the use of power for the dyeing and calendering process, supported by statements and the presence of electric motors connected to the machines. The applicants' defense that no power was used during the period in question, and the factory was transitioning to a power-operated facility for fabric processing, was deemed prima facie unacceptable. The applicants' plea of financial hardship lacked substantiation. Consequently, the tribunal directed a pre-deposit of Rs. 6,00,000/- out of the total duty demand within eight weeks. Upon this deposit, the pre-deposit of the remaining duty and penalty would be waived, and recovery stayed pending the appeal. Failure to comply would lead to the vacation of stay and dismissal of the appeal without prior notice, with a compliance report due on 9-12-2003.