2007 (9) TMI 463 - AT - Central Excise

Summary

Issues:
1. Stay application against Order-in-Original confirming demand of duty, penalty, and interest.
2. Alleged surreptitious removal of raw materials for production in a different unit.
3. Interconnection with a separate case involving de-bonding of a different unit.
4. Prima facie decision on waiver of pre-deposit and stay of recovery pending appeal.

Analysis:
1. The appellant filed a stay application against Order-in-Original confirming a substantial demand of duty, penalty, and interest under relevant provisions of the Central Excise Act, 1944. The case involved the applicant, engaged in manufacturing Optical Fibre and Optical Fibre Cable, allegedly manipulating records to avail inadmissible Cenvat credit by surreptitiously removing raw materials to a different unit for production.

2. It was found that the applicant had clandestinely removed cenvatable inputs to their adjacent unit, resulting in a significant duty credit amount. A separate case was booked against the other unit for manufacturing and clearing goods without permission, with findings of fabricated records. The Tribunal's order in the other unit's case was challenged in the Hon'ble Bombay High Court, leading to subsequent appeals and interim stays.

3. The present case was deemed interlinked with the case pending before the Hon'ble Supreme Court regarding de-bonding of the other unit. The applicant sought a waiver of pre-deposit and stay of recovery, citing the interconnected nature of the cases and potential favorable outcomes if the de-bonding request was granted retrospectively. The Tribunal acknowledged the material bearing of the Supreme Court's decision on the present case and granted the waiver and stay of recovery pending appeal.

4. In a prima facie decision, the Tribunal recognized the connection between the cases and the impact of the Supreme Court's decision on the present matter. Considering the subjudice status and the interim stay granted by the Supreme Court, the Tribunal ordered the waiver of pre-deposit and stay of recovery of duty and penalty in the current case, pending the final appeal resolution.

This detailed analysis highlights the complex legal issues, interconnections between cases, and the Tribunal's decision to grant the waiver and stay based on the interdependence of the matters and the ongoing judicial proceedings.