2004 (6) TMI 528 - AT - Central Excise

Summary

Issues:
1. Whether crushing of lime stone and preparation of raw meal/slurry amount to manufacture for the purpose of Central Excise duty liability.
2. Whether the appellants have a strong prima facie case justifying waiver of pre-deposit and stay of recovery.

Issue 1:
The judgment dealt with the question of whether the crushing of lime stone and the preparation of raw meal/slurry by the appellants amounted to manufacture for the purpose of Central Excise duty liability. The appellants argued that the Tribunal had previously held that crushing lime stone did not amount to manufacture, citing the case of SAIL v. Collector. Additionally, they highlighted an Order-in-Original by the jurisdictional Asstt. Commissioner which also concluded that the processing of mixing raw materials did not constitute manufacture. The appellants further contended that the raw meal/slurry was exempted from Central Excise duty under a specific notification. On the other hand, the Revenue cited a Supreme Court judgment but failed to successfully contest the arguments put forth by the appellants. Ultimately, the Tribunal found in favor of the appellants, holding that there was a strong prima facie case in relation to the duty demand, leading to the waiver of pre-deposit and stay of recovery.

Issue 2:
The second issue revolved around whether the appellants had a strong prima facie case justifying the waiver of pre-deposit and stay of recovery. The Tribunal considered the arguments presented by both parties. The Revenue relied on a Supreme Court judgment to support their position that the process in question amounted to manufacture. However, the Tribunal noted that the Supreme Court had left the question open in the cited case and found that the arguments regarding the excisability of crushed lime stone and raw meal/slurry had not been effectively contested. Consequently, the Tribunal concluded that the appellants had a strong prima facie case, leading to the decision to grant waiver of pre-deposit and stay of recovery in their favor.

This judgment from the Appellate Tribunal CESTAT, Chennai, highlighted the importance of legal precedents, specific notifications, and the interpretation of manufacturing processes in determining Central Excise duty liability. The decision underscored the significance of establishing a strong prima facie case to support requests for waiver of pre-deposit and stay of recovery in such matters.