2003 (10) TMI 586 - AT - Central Excise

Summary

Issues:
Application for waiver of pre-deposit of wrongly availed credit and penalty under Rule 173Q and Rule 209 of the Central Excise Rules.

Analysis:
The case involved an application for waiver of pre-deposit of Rs. 24,75,996/- alleged to be wrongly availed credit and a penalty of Rs. One lakh imposed upon the company under Rule 173Q and Rule 209 of the Central Excise Rules. The applicants, who were manufacturers of bulk drugs, had exported a quantity of Pseudo Ephedrine HCL to a company in the USA, and the goods were reimported at a later stage for certain processes. The Commissioner disallowed the credit, leading to the appeal. The Tribunal found that Rule 173MM and Rule 97B applied to the situation of rejected exports by the applicants. Despite this, the Commissioner had disallowed the credit without providing a clear reason for the decision. The Tribunal noted that there was no finding that the goods in question were not covered by Rule 97B, which permits the re-import of exported excisable goods for various processes. Consequently, the Tribunal held that a prima facie case for waiver had been established, and thus dispensed with the requirement of pre-deposit of duty and penalty, staying the recovery pending the appeal.