2008 (7) TMI 815 - AT - Central Excise

Summary

Issues Involved:
1. Pre-deposit of duty amount
2. Financial hardship of the appellant
3. Eligibility for benefit of Notification No. 10/2006-C.E.
4. Barred by time demand
5. Stay applications

Analysis:

Pre-deposit of duty amount:
The appellants were required to pre-deposit a duty amount of Rs. 23,82,804/- and another amount of Rs. 12,23,146. The appellant, a Kerala State PSU unit, pleaded financial hardship, showing a significant loss in their Balance Sheet. The Department proceeded against the appellants for recovery of duty, alleging they were not eligible for the benefit of Notification No. 10/2006-C.E. The appellant argued that all relevant facts were known to the Department, indicating no suppression of facts.

Financial hardship of the appellant:
The appellant, being a state PSU unit, faced severe financial hardship. The appellant's counsel emphasized that all necessary details were provided to the Department without any suppression of facts. The Balance Sheet reflected a substantial loss suffered by the appellant, further supporting their claim of financial distress.

Eligibility for benefit of Notification No. 10/2006-C.E.:
The Department issued show cause notices in 2006 concerning duty liability from March 2002 to February 2003. The appellant contended that the demands were time-barred, indicating that they were eligible for the benefit of Notification No. 10/2006-C.E. The Tribunal observed that the demands were indeed barred by time, leading to the allowance of the stay applications and waiver of pre-deposit amounts.

Barred by time demand:
After careful consideration, the Tribunal acknowledged the appellant's status as a state PSU unit facing significant financial losses. Given that the show cause notices were issued after the statutory time limit, the demands were deemed barred by time. Consequently, the stay applications were approved, with a waiver of pre-deposit amounts and a directive for no recovery even after 180 days from the order's issuance.

Stay applications:
The Tribunal allowed the stay applications by granting a waiver of pre-deposit amounts due to the appellant's financial hardship and the time-barred nature of the demands. Additionally, considering the substantial amount involved, the appeals were scheduled for an out-of-turn hearing on 3rd November 2008. The order was pronounced and dictated in open court, finalizing the decision in favor of the appellant.