2013 (10) TMI 614 - AT - Central Excise

SSI exemption - Clubbing of value of clearance of the other units Waiver of Pre-deposit Held that - Applicant are engaged in the manufacture of coal handling system for use in the thermal plant by TNEB for generation of electricity - applicants has already deposited 50% of the duty pre-deposit of balance duty interest and penalty waived and its recovery stayed during pendency of the appeals Stay granted.

Summary

Issues:
1. Waiver of predeposit of duty, interest, and penalty.
2. Allegations of raising invoices in the name of other units.
3. Denial of SSI exemption and clubbing of value in clearances.
4. Dispute regarding manufacturing activity and dummy units.
5. Consideration of deposited amount and grant of waiver.

Analysis:

1. The judgment pertains to multiple applications arising from a common order seeking waiver of predeposit of duty, interest, and penalty. The first applicant sought waiver of duty amounting to Rs.69,94,352, while the other two applicants requested waiver of penalties of Rs.10 lakhs each.

2. The applicants were involved in the manufacture of a coal handling system for a thermal plant. Allegations were made that they raised invoices in the name of other entities, namely M/s. Mani Engineering Works and M/s. Selvam Engineers & Contractors, implying that the goods were manufactured by these units. Consequently, the value of clearances from these units was clubbed together.

3. The advocate representing the applicants argued that the other units had manufactured the goods through job work and claimed Small Scale Industry (SSI) exemption, which was denied. The Revenue contended that the other units were merely dummy entities, and the entire manufacturing activity actually took place at the premises of the applicants. The dispute centered around the correctness of the duty demand.

4. The Tribunal acknowledged the factual disputes in the case, emphasizing that a detailed examination of the issues would occur during the appeal hearing. Notably, the applicants had already deposited a significant sum of Rs.33,54,423, equivalent to approximately 50% of the duty amount. Considering the overall circumstances, the Tribunal decided to grant a waiver of the balance duty, interest, and penalty, with the recovery stayed during the pendency of the appeals. Consequently, all stay applications were allowed.

5. The judgment, delivered by Shri P.K. Das, concluded by stating that the decision was dictated and pronounced in open court, providing a clear resolution to the issues raised regarding the waiver of predeposit in the case.