2004 (8) TMI 460 - AT - Central Excise

Summary

Issues:
1. Waiver of pre-deposit of excise duty and penalty.
2. Allegations of manufacturing commercial LPG mixture.
3. Contention regarding mixing of propane and LPG mix.
4. Evidence presented by the applicants.
5. Prima facie case for waiver of pre-deposit.

Analysis:

1. Waiver of Pre-deposit:
The judgment deals with applications for the waiver of pre-deposit of excise duty and penalties confirmed against two companies. The duty demands were related to clearances of LPG Mix made by the companies during specific periods. The Tribunal considered the applications for waiver in light of the contentions raised by the parties and the evidence presented.

2. Allegations of Manufacturing LPG Mixture:
The demands arose from the assertion that the companies manufactured LPG Mix by mixing commercial propane and LPG mixture imported separately in their storage tanks. The Tribunal examined various statements and reports to determine whether the mixing occurred at the discharge manifold or in shore tanks to produce commercial LPG mixture. The contracts, invoices, and operational procedures were scrutinized to establish the manufacturing process.

3. Contention Regarding Mixing of Propane and LPG Mix:
The applicants contended that mixing of the two gases was not feasible in the shore tank as alleged by the department due to technical limitations. They provided evidence from experts and industry practices to support their claim that mixing occurred in the vessel during transportation. The Tribunal considered the technical aspects and operational constraints to assess the plausibility of the mixing process.

4. Evidence Presented by the Applicants:
The applicants submitted affidavits, certificates, and expert opinions to demonstrate that the mixing of propane and LPG mix took place in the vessel and not in the shore tank as alleged. The evidence included statements from experienced professionals, operational practices in the industry, and technical restrictions that supported the contention that mixing in the shore tank was not feasible.

5. Prima Facie Case for Waiver of Pre-deposit:
After evaluating the submissions and evidence presented by the parties, the Tribunal found that the applicants had established a strong prima facie case for the waiver of pre-deposit of duties and penalties. The Tribunal noted discrepancies in the department's contentions and the evidence provided by the applicants, leading to the decision to dispense with the pre-deposit and stay the recovery pending the appeals. The appeals were scheduled for regular hearing on a specified date.

Overall, the judgment extensively analyzed the manufacturing process, technical feasibility, and supporting evidence to determine the validity of the duty demands and penalties imposed, ultimately granting the waiver of pre-deposit based on the established prima facie case presented by the applicants.