2004 (3) TMI 646 - AT - Central Excise

Summary

Issues:
1. Waiver of pre-deposit of Central Excise duty and penalty.

Analysis:
The case involved five applications by M/s. Steelage Tube (P) Ltd. seeking a waiver of pre-deposit of Central Excise duty totaling Rs. 9,68,967/- and a penalty of Rs. 1 lakh. The appellant argued that they were denied the benefit of deemed credit under Notification No. 58/97-C.E. (N.T.) because their suppliers had not discharged the appropriate duty liability under Rule 96ZP of the Central Excise Rules, 1944. The appellant claimed that their suppliers considered the duty liability discharged, while the Department viewed it differently. Reference was made to a decision of the Punjab & Haryana High Court in the case of Vikas Pipe v. CCE, Chandigarh-II, 2003 (158) E.L.T. 680 (P&H) to support their position.

The Department, represented by Shri Virag Gupta, argued that since the suppliers had not discharged the appropriate duty, the appellant was not eligible for Modvat credit. It was pointed out that the invoices from the suppliers only mentioned "goods cleared under Rule 96ZP" without explicitly stating that the duty had been paid. The appellant, through their advocate, referred to specific pages in the paper book showing the duty deposited by the supplier and the deferred duty amount.

Upon considering the submissions from both parties, the Tribunal found that the duty had indeed been discharged by the supplier of the raw material, albeit subject to the stay of the Department. Citing the decision of the Punjab & Haryana High Court in the case of Vikas Pipe, the Tribunal concluded that the appellant had presented a strong prima facie case. Consequently, the Tribunal ordered a stay on the recovery of the entire duty and penalty amount during the appeal's pendency. The matter was scheduled for regular hearing on 5th May 2004.