2011 (2) TMI 889 - AT - Central Excise

Waiver of pre-deposit - Modification of earlier stay order to deposit 20% are modified - The demands stand confirmed against the appellants on the allegations and findings of availment of non-admissible Modvat credit on the ground that the same has been availed on the strength of fake and fictitious invoices issued by non-existent buyers -when the impugned orders are going to be set aside by following the earlier orders, any pre-deposits required to be made by the appellants would be liable to be refunded to them. As such, no benefit is going to be derived by directing the appellants to deposit part amounts. They have relied upon the various decisions of the Tribunal as also on Hon ble Supreme Court s decision in the case of CCE Hyderabad Vs. M/s ITC Ltd. 2004 -TMI - 47165 - SUPREME COURT OF INDIA , in support of their contention that when the appeal is remanded, there is no confirmation of duty against an assessee and is entitled to claim refund of pre-deposit along with interest, pending re-adjudication by the Commissioner - Hence, the impugned orders are set aside and matters remanded to the original adjudicating authorities for fresh adjudication

Summary

Issues:
Confirmation of demands on the basis of non-admissible Modvat credit; Modification of stay order requiring pre-deposit of 20% of confirmed demand; Applicability of pre-deposit conditions when appeals are remanded.

Analysis:
The judgment by the Appellate Tribunal CESTAT, Ahmedabad, involved the confirmation of demands against the appellants for availing non-admissible Modvat credit based on fake invoices. The issue of modifying the stay order, which required a pre-deposit of 20% of the confirmed demand, was also addressed. The Tribunal considered the submissions from both sides, including the Revenue and the appellants, represented by their advocates. The Revenue argued for consistency in directing appellants to deposit 20% of confirmed dues, citing previous cases. However, the appellants contested this, emphasizing that since earlier orders had been set aside and matters remanded in similar cases, any pre-deposits should be refundable. They relied on Tribunal decisions and a Supreme Court ruling to support their contention that when an appeal is remanded, no confirmation of duty exists against the assessee, entitling them to claim a refund of pre-deposits. The Tribunal cited precedents and agreed with the appellants, concluding that pre-deposit directions would not align with established legal principles. Consequently, the Tribunal dispensed with the pre-deposit condition and granted an unconditional stay, setting aside the impugned orders and remanding the matters for fresh adjudication to the original authorities in line with previous rulings. All stay petitions, modification applications, and appeals were disposed of accordingly. The judgment highlighted the importance of legal precedents and the principle of fairness in dealing with pre-deposit conditions when appeals are remanded for fresh adjudication.