2013 (11) TMI 77 - AT - Central Excise

Waiver of Pre-deposit Cenvat credit - Credit of Education cess denied on the ground that as per Rule 3(7)(a) of CCR an assessee receiving goods from EOU can avail credit of BED only - Revenue was of the view that the assessee has availed cenvat credit of the amount of CVD paid by 100% EOU - Held that - A non-obstante clause is used where contrary provisions exist not on all the provision contained Rule 3(7)(b) & 3(1) are applicable to all so credit of education cess is admissible - Following M/s TURBO ENERGY LTD VERSUS COMMISSIONER OF CENTRAL EXCISE (LTU) CHENNAI 2013 (10) TMI 802 - CESTAT CHENNAI - Even after the insertion of proviso in Rule 3(7) of Cenvat Credit Rules formula remains the same for discharge of CVD under the Rules - the appellant has made out a prima facie case for the waiver of pre-deposit of the amounts involved - Application for the waiver of pre-deposit of the amounts involved is allowed and recovery stayed till the disposal of appeal Stay granted.

Summary

Issues:
Stay petition for waiver of pre-deposit of an amount, eligibility of cenvat credit, interpretation of Notification No. 22/2009-CE (NT) dated 07.09.2009.

Analysis:
The appellant filed a stay petition seeking the waiver of pre-deposit of Rs. 1,35,29,689/-, along with interest and penalty. The amounts were confirmed as ineligible cenvat credit by the adjudicating authority, alleging that the appellant availed credit of CVD paid by 100% EOU, including Education Cess and Secondary and Higher Education Cess. The Revenue contended that the appellant's cenvat credit prior to the effective date of Notification No. 22/2009-CE (NT) dated 07.09.2009 was ineligible. The appellant relied on Tribunal decisions in similar cases and a stay order in an identical issue granted to another party. The Tribunal noted that the appellant indeed availed cenvat credit of the mentioned cess amounts paid by EOU, and the issue was the same as in the prior Tribunal decision. Despite the insertion of a proviso in Rule 3(7) of Cenvat Credit Rules, the Tribunal found the formula for discharge of CVD remained unchanged.

The Tribunal considered both parties' submissions and the record, concluding that the appellant had a prima facie case for the waiver of pre-deposit. Relying on a previous coordinate Bench decision and the stay order of 15.01.2013 in a similar issue, the Tribunal granted the waiver of pre-deposit and stayed the recovery until the appeal's disposal. The Tribunal's decision was based on the finding that the appellant met the criteria for the waiver of pre-deposit, following the precedent set by the coordinate Bench in a related matter.